China has a population of 1,350 billion people and a
GNI (Gross National Income) per capita of 5.740 USD.
Starting a business in China is not easy. 13 procedures and 33 days are necessary before your company can be operational.
Where to address to register your company? To register your company you need to address the local Administration of Industry and Commerce (AIC).
Here are the steps to starting a business:
1. Receive a company’s name pre-approve
To get a notice of your business name’s pre-approval
you need to address the local Administration of Industry and Commerce (AIC) or
go on AIC’s Web site, download the form and submit the application. If your
company has more shareholders you can act on their behalf when it comes to advancing
the documents but the application needs to bear all partners’ signatures. The
dossier required for a company’s registration with the AIC must contain:
-
The application form
-
Business licenses or other registration
certificates
- Photocopies
of the shareholders identity cards
If you submit the dossier in person your company’s
name can be approved or rejected on spot depending on the name’s availability.
If you register your application via mail, fax, email, etc., you will get an
approval or rejection on the chosen name within 15 days.
The time need to complete this procedure is 1
working day and is free of charge.
2. Deposit the initial capital with a bank
After you receive the
approval of your company’s name you need to address a bank and deposit the
minimum capital required by law. This is around 4.800 USD. This happens if your
capital contribution is in cash.
If the initial capital is
in nonmonetary assets (no more than 70% of the registered capital) you need to
transfer the property titles to your company and have them monetarily assessed
by legally established verification institutes.
This procedure requires 1
working day and is free of charge
3. Receive the capital verification report
from an auditing firm
To complete the
registration procedure you need to address an auditing firm and obtain the
company’s capital verification report.
The procedure will cost
you 56 USD and will require 2 working days
4. Obtain the registration certification
"business license of enterprise legal person", the organization code
certificate from and register for state and local tax with the tax bureau
Since July 2010, you can submit the documents for business license, certificate
for quality and technology and state and local tax all at once. You can
download the forms from SAIC’s website. The business license is approved first. To obtain it you need the
following documents:
-
Application form which you can download
from the local government authorities’ Web sites
-
Approval of company’s name
-
Proof of office space
-
Capital verification certificate. For
nonmonetary assets you need to present the document that certifies the transfer
of property
-
Company’s statues
-
The authorization to represent the
company
-
Shareholders and officers identity card
-
Identification documents for the
company’s legal representative
-
Other documents
The application for business license requires 15
days to be processed. After the approval is granted you will be issued a
“notice on approval for establishment registration” which you can pick up in 10
days
If you file your application by letter, telegraph,
telex, fax, email, or electronic data exchange, the Company Registry must
decide whether to accept it or not, within 5 days of submission. If the
application is incomplete you will be informed within 5 days, of all contents that
needs correction.
After obtaining the business license you have 30 days to register for the certificate for quality and technology.
To obtain the certificate you need to address the Shanghai Organization Code
Management Center (a branch of the Quality and Technology Supervision Bureau) and
submit the following documents:
• Business license (original and one copy)
• Identity card of the legal representative (one copy)
The registration with local and state taxes requires
the following documents (Source: www.doingbusiness.org):
-
Tax
registration form and the initial tax reporting form
-
Business license duplicate (original and one
copy)
-
Organization
code certificate (original and one copy)
-
Identification
card of the legal representative (original and one copy)
-
Identification
card of the taxation personnel (original and one copy)
-
Company
seal and financial seal
-
Office
lease agreement and receipt(s) for rent paid
-
Company’s
statues (original and one copy) and bank-issued account-opening certificate
(original and one copy)
-
Capital verification report
-
Photocopy
of property ownership certificate
-
Land
use right certificate
-
Commitment
letter regarding the authenticity of the documents submitted
This
entire procedure takes about 11 days to complete.
5. Get
police’s approval to make a the company’s seal
This procedure requires 1 day to be completed. To
obtain the approval for making the company’s seal you need to submit your
identification card and the duplicate of the business license (the original and
one copy)
6. Make
the company’s seal
To
make the company seal, you need to address a company possessing a Shanghai
Special Industry Permit (company seal carving). The seal will cost you around
11 to 48USD, depending on design, quality and complexity.
7. Pay
the fee for the organization code certificate
After
obtaining the company seal you can address the Quality and Technology Supervision Bureau to pay and pick up your
organization’s code certificate. The fee is around 16 USD.
8. Register
with the local statistics bureau
Within
30 days of obtaining the business license, you must register your company with
the local statistics bureau. To do that you need to file a form together with
the following documents:
-
Business license (one copy)
-
Organization
code certificate (one copy)
This
procedure requires 1 working day to be completed and is free of charge.
9. Open
a formal bank account of the company
Once
you have opened a formal bank account on your company’s name you need to
transfer the registered capital to the new account. The procedure and required
documents vary according to your bank’s policies.
10. Obtain
the authorization to print or purchase financial invoices/receipts
In
order to legally operate your business you must acquire the right to purchase
and issue financial invoices/receipts. To do this you need to address the state
and local taxation offices and submit a dossier that contains the following
documents:
-
Tax registration certificate (one copy)
-
Identity
card of taxation personnel (one copy)
-
Application
forms
-
Models
of invoice seal
This
procedure requires 10 working days to be completed and is free of charge.
11. Purchase
uniform invoices
To
purchase uniform invoices you need to submit an application form to the Tax
Office. This is done in order to avoid forgery.
12. Register
with local career service center
You
must register your employees with the local career service center within 30
days of recruiting. This procedure takes 1 day to be completed and is free of
charge.
13. Register
with Social Welfare Insurance Center
Within 30 days of operation, you need to register with the local social
insurance office for your employees’ social insurance. The dossier must contain:
-
the
registration form,
-
the
company’s seal,
-
duplicate
of business license (original and one copy)
-
organization
code certificate (original and one copy)
If
the submission is accepted you will have to open a social insurance account for
the company at a bank designated by the authorities. Upon receiving the bank’s
notification of account opening, the insurance office will issue the social
insurance.
This
procedure takes 1 working day to complete and it can be done simultaneously
with the previous one
Summing
up: to open a business in China you need to undergo 13 procedures, wait for 33
days and pay 120 USD in fees.
