Foreign Direct Investment

Wholly Foreign-owned Enterprises
The application procedures for the establishment of wholly foreign-owned enterprises are more simple.

The time limit for the approval of applications for the establishment of wholly foreign-owned enterprises is as follows: The approval organ must give a written reply within 30 days after receiving preliminary application from the foreign investor and decide whether or not to grant approval within 90 days (for Guangzhou and Shenzhen, 15 working days) as from the day all documents required for the formal application are received.

For wholly foreign-owned enterprises, the date of the issuance of business licence is the date of their incorporation. The foreign investor may appoint an FIE service company or other economic organisations to handle the application procedures, but a power of attorney must be signed.

Application Procedures for Establishment of Wholly Foreign-owned Enterprises

Step 1: Submission of Preliminary Application

The foreign investor of a foreign enterprise should submit a report to the foreign trade and economic cooperation department at county level or above at the place where the proposed enterprise is located.

Content of report: Objectives of the wholly foreign-owned enterprise, business scope, scale of operation, products to be produced, technology and equipment to be used, land area required, conditions and quantities of water, electricity, gas and other forms of energy resources required, and requirements for public facilities.

Step 2: Submission of Formal Application

After the foreign investor receives a written reply from the relevant government authorities, a formal application supported by all the required documents should be filed with the local foreign trade and economic cooperation department at county, municipal or provincial level.

Documents required: Application letter for establishing the wholly foreign-owned enterprise; feasibility study report; articles of association; list of legal representatives (or board of directors); foreign investor’s legal papers and credit report; list of materials to be imported; written replies from the local approval authorities at county level or above; application for registration of the name of the enterprise approved by the provincial or municipal administration for industry and commerce; comments on the project by various government departments such as environmental protection, fire services, health and land administration. In case where two or more foreign investors are involved, copies of the contracts signed by them should be submitted to the approval authority for the record.

Step 3: Application for Approval Certificate

After the formal application is approved, the foreign investor should apply to the foreign trade and economic cooperation department at county, municipal or provincial level for an approval certificate by presenting all the necessary documents.

Documents required: Application letter for establishing the wholly foreign-owned enterprise, feasibility study report, articles of association and list of board of directors.

Step 4: Registration

Upon collection of the approval certificate, an application for business licence should be filed with the provincial or municipal administration for industry and commerce within 30 days. Subsequently, the enterprise should complete such procedures as applying for official seal and enterprise code, opening bank account, and registering for tax payment and customs declaration with the local public security, technical supervision, taxation, Customs, finance, foreign exchange administration, banking, insurance and commodity inspection departments.

Client Testimonial

One of the best China lawyers based in Shenzhen! I appreciated this Shenzhen lawyer's service because they helped me achieved my goals, though it was a tough mission. They are English speaking lawyers, so there are absolutely no communication barrier you likely encounter elsewhere. What impressed me is these Shenzhen lawyer's quick response and professional service, two characteristics which I treasure most. Although the Shenzhen lawyers are based in south China, they represent clients across the country, so you can also call them China lawyer! - Johnson