Foreign-invested companies in China will see an easing of company registration requirements based on the principle of national treatment, according to according to Zhang Mao, head of China’s State Administration of Industry and Commerce (SAIC). He also clarified that those policies also apply to foreign businesses.
Based on the national treatment principle, foreign companies are entitled to the same policies as their Chinese counterparts enjoy, meaning, when the Chinese government eases the setting-up requirements for Chinese companies, foreign investors should receive the same treatment.
The reform of the company capital registration system includes the following areas:
* Lowering the registered capital requirements for setting up a company;
* Replacing the current annual inspection system of enterprises with an annual reporting system;
* Relaxing business premise registration requirements for market players;
* Facilitating the establishment of an enterprise credit system; and
* Promoting the subscribed capital contribution registration system.
China will relax the thresholds of registered capital, the minimum registration capital of RMB30,000 for limited liability companies will be canceled, as well as the RMB100,000 minimum for single shareholder companies and the RMB5 million minimum for joint stock companies. Besides, the requirements for business premise registration will be simplified.
Moreover, measures will be taken to reduce the costs of business set-ups, and meanwhile, efforts will be made to build an integrity system whereby enterprises that violate the law will be put on a “blacklist” and be announced to the public.
The reform aims to lower market entry requirements while reinforcing the responsibility of market players. It is also part of the central government’s commitment to move away from the current “emphasizing approval while neglecting regulation” mode to “easier market access and reinforced supervision” mode.
The number of foreign companies newly established in China this year stood at 16,351 as of September 2013, representing a 9.29 percent decrease compared with the same period last year.
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A foreigner in Beijing has been given a 7-day detention and a fine of 6,500 yuan ($1,070) for traffic violations and illegal employment and will be deported along with his father after serving the term, said police.
The foreigner, whose nationality and name haven't been disclosed, hit a middle-aged Chinese woman at the Zuojiazhuang intersection in Chaoyang district when riding a scooter on Dec 2.
The man was also detained for 7 days and fined 1,500 yuan for other breaches of the traffic regulations, as during their investigation into the accident the police found the foreigner had neither a driving license nor a motorbike plate and he was carrying a passenger on a scooter.
Police also found that the man and his father were working illegally. So he was detained for another 5 days and fined 5,000 yuan; his father was detained for 14 days and fined 10,000 yuan. The company that illegally hired the pair fined up to 20,000 yuan. Both the man and his father are to be deported on their release, the police said.
The police said expatriates in China should comply with the country's laws and regulations. Police protect their rights, but they will also keep lawful management of them and crack down on illegal behavior to maintain social order.
Every country is happy to see foreign visitors whose activities comply with the local laws, but unreliable foreigners should not be made welcome.
But although offenders are subject to criminal liability and deportation, the financial penalties are not severe. Under the provisions of the exit-entry law, foreigners staying in the country illegally may be given a warning before being fined, or a 500 yuan fine levied for each day they overstay. In severe cases the fine may be as high as RMB 10,000 and individuals could face detention for a period of between 5 to 15 days, and employers may be fined RMB 10,000 for every illegal foreigner they employ up to a maximum fine of RMB 100,000. Any monetary gains that have resulted from the employment of such individuals will also be forfeit.
So, if you are working in China, you had better get a resident permit (also known as work visa, z visa) to work legally. Touch Law Firm provides you professional visa consulting services. If you are interested in residence permit, please contact us by visiting our official website: www.touchlawfirm.com or email to infor@touchlawfirm.com to know more information.
The Wholly Foreign Owned Enterprise (WFOE) is a limited liability company wholly owned by the foreign investors. After China's entered into the WTO, the WFOE is increasingly being used for service providers.
WFOE has great potential in China as companies seek new markets. In 2014, China will be the world’s top investment destination.
The advantages of incorporation a WFOE, compared with other types of enterprises, include, but not limited to:
• Independence and freedom to implement the worldwide strategies of its parent company without having to consider the involvement of the Chinese partner.
• Ability to formally carry out business rather than just function as a representative office and being able to issue invoices to their customers in RMB and receive revenues in RMB.
• Protection of intellectual know-how and technology.
Touch Law Firm, as faithful partner to international enterprises and individuals, is dedicated to providing with professional investment solutions in China, including company registration, tax & accounting, intellectual property and China visa consulting etc. With experienced consultants, accountants and other professionals we have rendered services to over 3,000 clients from more than 60 countries and regions around the world.
Touch Law Firm, Your Key to China. Our services include: company registration, tax & accounting, intellectual property & China visa consulting, etc.Contact us by calling at +86-20 8355 5515 or visit our website: www.touchlawfirm.com
Please like our facebook page: https://www.facebook.com/TouchLawFirmInGuangzhou
