Concept of Guangzhou FIE

 

Guangzhou Foreign Investment Enterprise (FIE) is a limited liability company set up in Chinese territory with all the register capital comes from foreign investors. Foreign investors include foreign enterprises, other foreign economic organizations and individuals as well as Hong Kong-, Macao-, Taiwan-, investors. Foreign Investment Enterprise includes two forms, Foreign Joint Venture (JV) and Wholly Foreign Owned Enterprise.

 

Advantages of Establishing a Foreign Investment Enterprise

 

1. There is no requirement for investors to be established for over 2 years while parent company of Representative Office should as least has 2 years history.

2. Protect Intellectual property and Independent technological patents

3. Ability to apply import and export qualification and Export Tax Refund

4. Ability to formally carry out business rather than just function as a representative office which is restricted in many ways.

5. Be more convenient to conduct company operation and management

6. Ability to receive RMB revenues and issue official invoices.

7. Legal profits, lawfully-earned income and funds after liquidation can be remitted abroad.

 

Registered Capital and Paid-Up Capital

 

Registered capital is the amount that it’s required to run the business until it can break even - the 'minimum registered capital' is a guideline only. The amount of registered capital needed depends on factors like industry, scope of business as well as location. Generally speaking, for manufacturing and trading enterprise, the registered capital is required RMB 1 million or above. For service enterprises, such as consultancy, technology, market research and development, the registered capital is usually required RMB 500, 000 or above. Once business license is issued, 15% of registered capital should be paid up during 3 months, with the balance being remitted within 2 years. All the registered capital can be paid in one time or several times, fewer times, fewer capital verification fees are needed.

 

The proportion of registered capital and total amount of investment of Foreign Investment Enterprise shall abide by the following provisions:

 

1.Where the total amount of investment is less than 3,000,000 U.S. dollars (including 3,000,000 U.S. dollars) the registered capital shall account for seven tenth of the total amount of investment at least.

2. Where the total amount of investment is between over 3,000,000 U.S. dollars to 10,000,000 U.S. dollars (including 10,000,000 U.S. dollars) the registered capital shall account for half of the total amount of investment at least. Where the total amount of investment is less than 4,200,000 U.S. dollars, the registered capital shall be not less than 2,100,000 U.S. dollars.

3. Where the total amount of investment is between over 10,000,000 U.S. dollars to 30,000,000 U.S. dollars (including 30,000,000 U.S. dollars), the registered capital shall account for two fifths of the total amount of investment at least. If the total amount of investment is less than 12,500,000 U.S. dollars, the registered capital shall be not less than 5,000,000 U.S. dollars.

4. Where the total amount of investment is over 30,000,000 U.S. dollars, the registered capital shall account for one third of the total amount of investment at least. If the total amount of investment is less than 36,000,000 U.S. dollars, the registered capital shall be not less than 12,000,000 U.S. dollars.

 

Business Scope

 

Business scope is one of the most important issues in FIE registration application, divided into the licensed business item and the general business item. Licensed business item means a pre-approval is needed before business license application. General business item means ordinary item which can be registered in Bureau of Industry and Commerce directly. Guangzhou Foreign Invested Enterprise can only conduct business within its approved business scope, which ultimately appears on the business license. There is some connection between business scope and register capital. Generally speaking, larger register capital, more business items can be approved.

 

Shareholder, Director and Manager, Legal Representative, Supervisor

 

1. Shareholder must be foreign investors (companies or individuals), including Hong Kong-,

Macao-, Taiwan-, investors.

2. Director and Manager can be the same person, acted by shareholder, non-shareholder, foreigners or Chinese.

3. Legal representative is a very important position, represents the interests of enterprise as a legal person, acted by director, manager, shareholder or non-shareholder.

4. Supervisor shall not serve concurrently as legal representative and senior management, acted by shareholder, non-shareholder, foreigners or Chinese.

 

Needed Documents for Registration of a Foreign-Invested Company

 

1. Proof of subject qualification or proof of identification as a natural person for investors

2. Original Bank Reference Letters from investor’s bank (declare a good standing).

3. Certificate of company domicile: 2x original leasing contracts, 2x copies of house property certificate with company stamp or signature of lesser and 2x landlord identification documents

4. Photocopies of documents of appointment and proof of identification for directors, supervisors and managers
5. Photocopies of documents of appointment and proof of identification for legal representative
6. Articles of association
7. The minutes of the inaugural assembly;
8. Letter of authorization for service of legal documents

9."The establishment registration application Form for foreign invested Enterprises" by the legal representative to be appointed

10. Pre-approval document or certificate;
11.Other relevant documents and certificates;

 

Guangzhou FIE Registration Procedure

 

1.  Name registration with Guangzhou Administrative Bureau of Industry and Commerce

2.  Pre-approval document or certificate for some special industries

3.  Approval application from Fire and Environment Bureau for manufacturing industry

4.  Certificate of Approval issued by Bureau of Foreign Trade and Economic Cooperation of Guangzhou Municipality

5.  Apply for Business License with Guangzhou Administrative Bureau of Industry and Commerce (GZABIC).

6.  The official seal inscribed by Public Security Bureau

7.  Organization Code License issued by Quality and Technical Supervision Bureau

8.  State tax certificate registration

9.  Local Tax certificate registration

10.  Foreign Exchange Registration Card issued by State Administration of Foreign Exchange (SAFE)

11.  Apply for the permits for the bank account opening，open foreign currency and RMB account

12.  Registration with Finance Authorities

 

Processing Time for Guangzhou FIE

 

1. Trading enterprise: 50-80 working days  

2. Service enterprise: 50-70 working days   

3. Manufacturing enterprise: 50-70 working days (the time of approval papers application from the fire & environmental protection bureaus is not included)  

 

Service, Fee and Terms of Payment

 

1.  ZANYA package services for Guangzhou FIE formation include:
Company name check and confirmation；Document preparation for application purposes, such as a feasibility study report, M&A, etc.；Certificate of Approval；Business License；Having a corporate seal engraved by the public security authorities; Organization Code Certificate ；Digital Certificate of Organization Code Certificate；National Tax Certificate；Local Tax Certificate；Foreign Exchange Registration Certificate；Assist bank opening, but not including the bank charges；Permit of bank account opening；Finance Registration Certificate；Company stamp, financial stamp and personal stamp of legal representative. All the certificates above include original one and duplicate one.

 

2.  Terms of payment: applicant can pay by cash, check or T/T to ZANYA’s bank account before the service begins.

 

General Tax Information

 

All enterprises are required to report to the Tax Administration Department monthly, quarterly and annually. ZANYA provides accounting services for our clients; you are welcome to contact us for more information.

 

Annual Audit Report  

 

Any limited companies in China should summit annual audit report to the relevant authorities. Any company will be subject be to a fine if the Annual Audit Report is not submitted in a timely manner.

 

Follow-Up Service of Guangzhou FIE

 

1、General tax payer application

2、China Export Tax Refund Application

3、Import and export license application

4、Business license alteration

5、Apply Capital Verification Report with Certified Public Accountant (CPA) (after Inject capital from investor’s overseas bank account).

 

ZANYA provides a series of business follow-up services such as, monthly bookkeeping and tax return, internal auditing, financial planning and tax layout, and China policy & market study. Other services include domain name registration, webpage design, website promotion, China trademark registration, Work Permit, Residence Permit, etc.

 

For further information or assistance, please feel free to contact us

 

Tel: (86.20); 37887606        Mobile: 13928789801 (You can inquire in English)

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