New rules to ease company registration in China

NEW RULES TO EASE COMPANY REGISTRATION IN CHINA

Company registration for a new business in China has become an easier process as China has reduced the company registration capital requirements in order to decrease the costs linked with establishing new business in the country. The transformation intends to reduce the market entry requirements for companies while reinforcing the responsibility of market players.
Once you register your company, you can hire Chinese as well as foreigner employees for your company, arrange work visa for the foreigner employees, pay their salaries and contribute their mandatory benefits (social insurance and housing fund contributions).
China’s State Administration of Industry and Commerce (SAIC) declared that ‘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.’

Improvement of the company capital registration will focus on the following:

  • Reducing the registered capital requirements to set up a company in China;
  • Replacing the current annual inspection system of enterprises with an annual reporting system;
  • Relaxing the criteria for business premise registration;
  • Facilitating the launch of enterprise credit system;
REDUCING THE REGISTERED CAPITAL REQUIREMENTS TO SET UP A COMPANY IN CHINA

According to the new PRC Company Law, minimum registered capital requirements have been removed and investors can now propose the amount of capital to inject and the period of contribution of registered capital. Some companies operating in certain sectors will be an exception to this and will continue to be subject to minimum capital requirements imposed by industry-specific rules and regulations.

REPLACING THE CURRENT ANNUAL INSPECTION SYSTEM OF ENTERPRISES WITH AN ANNUAL REPORTING SYSTEM

Since 2014 all the enterprises have adopted the annual reporting system which replaced the existing annual inspection system. Enterprises may release relevant information to the public. Government authorities ensure the implementation and efficiency of the new rule.
RELAXING THE CRITERIA FOR BUSINESS PREMISE REGISTRATION
The requirements for ‘business premise registration’ upon company registration have been lowered. Detailed execution is at the local government’s discretion.
FACILITATING THE LAUNCH OF ENTERPRISE CREDIT SYSTEM

The last two years a new credit system has been encouraged and information such as business registration, annual reports, and qualifications should be presented as credit information of each business entity in the credit system. Electronic business licenses and electronic registration management has also been encouraged. To eliminate law-breaking, entities could be placed in a ‘black list’ for violating laws and regulations and such wrongdoings shall be communicated to market players through the new system.

HOW HRONE CAN BE BENEFICIAL TO YOUR BUSINESS IN CHINA

HROne’s service can handle the complete employee benefits for your company in compliance with the local policies and also can take care of the visa for your company’s expatriate employees. We can directly hire employees for a company not having a legal entity in China by our specialized Employee Leasing/Talent dispatching services.

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Please send email to Info@HROne.com, or call us on +86 21 52110025.

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