Keywords: Partnering with foreign investors to establish businesses in China efficiently and conveniently; achieving new breakthroughs in attracting investment; the Belt and Road Initiative.

Counseling Attorney:

Tongfang Foreign Affairs Professional Committee:

The Professional Committee for Foreign-related Business of Tongfang was established in 2022, taking advantage of the implementation of the RCEP agreement. Guided by the nation’s “Belt and Road” initiative, the committee is deeply committed to advancing the development of foreign-related business. With the mission of “Dedicating our youthful vigor to shining a light on our great China,” Tongfang’s Professional Committee for Foreign-related Business is devoted to ensuring the country’s long-term stability and prosperity, the well-being and happiness of the people, the great rejuvenation of the Chinese nation, and the comprehensive revitalization of local economies—doing its utmost with all its capabilities, fulfilling its responsibilities, and living up to its duties.

Liu Yu Senior Partner at Liaoning Tongfang Law Firm and Head of Tongfang’s Foreign-Related Legal Services Team;

Educational Background: Kyushu University (Japan)

Areas of Expertise: Foreign Investment, Corporate Legal Counsel, International Litigation, Equity Mergers and Acquisitions, Taxation, Financing, Leasing, Factoring, and More

Working languages: Chinese, Japanese, English

Li Fangzhi: Full-time lawyer at Liaoning Tongfang Law Firm

Educational Background: Kyushu University (Japan), Liaoning University

Areas of expertise: Corporate legal counsel, foreign-related litigation, and labor and personnel legal services, etc.

Working languages: Chinese, Japanese, English

Jin Huisu: Full-time lawyer at Liaoning Tongfang Law Firm

Educational Background: Northeast University of Finance and Economics

Areas of expertise: Corporate legal counsel, internal corporate audits, and board of directors’ operations.

Working languages: Chinese, Japanese, English, Korean

Basic Information: Registering and establishing a company in China is the first step for foreign investors to “follow local customs” and conduct business in China. In a narrow sense, company establishment refers to the company’s registration and filing. In a broader sense, company establishment encompasses not only registration and filing but also essential procedures such as engraving the official company seal, registering employees for various social insurance programs, and opening a bank account. The process can be divided into the following interconnected steps: self-declaration of the company name → establishment registration → engraving the official company seal and applying for invoice tax control equipment → social insurance registration, medical insurance registration, and housing provident fund registration → and finally, bank account opening and related procedures.

Currently, China’s administrative approval centers, guided by the principle of convenience and efficiency for the public, offer services such as online company registration and change-of-registration filings. Therefore, relevant procedures can be carried out online, specifically following these steps:

Step 1: Self-Declaration of Name

The company name must be approved in advance. Once approved, the name is reserved for two months from the date of approval. If a company name needs to include “XX Province” or “China,” it must meet certain requirements regarding registered capital, years since establishment, number of subsidiaries, and other criteria.

Step 2: Registration and Filing

Preparation materials: These are mainly divided into shareholder documents, articles of association, appointment documents, and other application documents.

[Shareholder Documents] If the shareholder is a foreign legal entity, it must provide the local business license as well as a certification document authenticated by the Chinese Embassy in that country. A copy and a translated version of the business license are also required. (Note: For foreign-invested enterprises with natural-person shareholders, online processing is limited to Hong Kong and Macao residents’ permits for traveling to and from the Chinese mainland, overseas Chinese passports, Taiwan residents’ permits for traveling to and from the Chinese mainland, and permanent resident identity cards for foreigners. For cases involving other types of identification documents, the application must be processed offline.)

[Articles of Association] Regarding the company’s registered address, some regions permit the use of virtual addresses for the statutory residence—for example, the Dalian Free Trade Zone (as of the date this document was published). As for the scope of business activities, it is essential to confirm in advance the contents of the “Negative List for Foreign Investment” to avoid being unable to carry out relevant business operations in China.

[Appointment Documents] In addition to the relevant appointment documents, you must also prepare photocopies of identification documents. Photocopies and translated copies of identification documents are required for shareholders, legal representatives, directors, supervisors, and managers (foreign nationals).

[Other Documents (Templates Provided by the Government Service Platform)] These documents include the “Notification and Commitment Letter for Self-Declaration and Use of Enterprise Names,” the “Application Form for Company Registration (Filing),” the “Commitment Document for Foreign-Invested Enterprises,” and others. After confirmation, these other documents shall be stamped by the foreign investor (if the investor is a legal entity, the signature of its legal representative is required) and then submitted.

Step 3: Seal Engraving and Tax Registration

For official seal engraving, you can select the material and type of seal online. You can either purchase it online as needed or skip this step and buy it offline on your own. Tax registration and business registration share the same set of documents. In principle, tax registration is automatically completed after business registration; at that time, you can handle tax registration online and issue electronic value-added tax invoices to each taxpayer. Please note that when registering for tax purposes, you need to choose between general taxpayer registration or small-scale taxpayer registration. Enterprises can select the appropriate option based on their own needs.

Step 4: Social Security Registration, Medical Insurance Registration, and Housing Provident Fund Registration

After a company is registered, it will obtain social security and medical insurance accounts, at which point it can independently complete the registration process based on factors such as the number of employees. If the company subsequently wishes to register for housing provident fund, it will need to apply in person at the service counter. Before doing so, it must first undergo authentication at a locally designated bank. If the company’s legal representative and shareholders are foreigners, the bank counter will coordinate the authentication procedures. After completing authentication, prepare the required documentation and proceed to the housing provident fund service counter to submit the application and obtain the access key. Subsequently, you can carry out all further operations on the designated housing provident fund platform.

Step 5: Open a bank account and complete the procedures.

You can make your selection online, but the actual transaction must be handled at an offline counter. You may skip this step if necessary. Please note that requirements and documentation vary depending on the bank; refer to the bank’s specific requirements for details.

Tax Registration

Currently, to facilitate tax registration for businesses, some regions have developed modules that can be operated via official WeChat accounts—these are extremely simple and convenient. Therefore, we’d like to remind you of just the following four points.

1. When handling tax procedures, you may simultaneously bring the foreign dispatched personnel—along with their original passports and their real-name registered mobile phones—to the tax counter to activate the “Individual Income Tax” app, so that they can conveniently handle subsequent tax refunds and adjustments.

2. If the company’s legal representative is a foreign national, the name used for tax registration must be in English, so that individual income tax refunds can be processed smoothly in the future. This is because banks require foreign nationals’ bank accounts to be registered in English; if a foreign national registers using another country’s language, the bank account name may not match the tax registration name, potentially resulting in failure to obtain a tax refund.

3. Please confirm in advance whether China and the other country have implemented a relevant social security agreement. For example, according to the “Notice from the General Office of the Ministry of Human Resources and Social Security on Implementing the China-Japan Social Security Agreement,” under certain conditions, Japanese personnel dispatched by the Japanese side are exempt from paying basic employee pension insurance in China.

4. The dispatched personnel will send the tax clearance certificate to their home country’s finance department to avoid the risk of double payment of personal income tax.

Project Highlights:

The highlights of the foreign-related legal services team’s work in helping foreign investors “come in” include:

1. Provide a comprehensive market entry strategy: Offer foreign investors tailored market entry solutions, including industry analysis, policy interpretation, and business environment assessment.

2. Legal Compliance Review: Ensure that the business activities of foreign investors comply with Chinese laws and regulations, including aspects such as company establishment, tax compliance, and adherence to labor laws.

3. Risk Assessment and Management: Assess potential legal risks and provide corresponding risk control and response strategies.

4. Cross-cultural communication and coordination: Leveraging the team’s cross-cultural communication skills to help foreign investors establish strong, collaborative partnerships with local partners.

5. One-stop service: We offer comprehensive legal services ranging from company registration and intellectual property protection to contract negotiation and dispute resolution.

6. Ongoing legal support: Providing foreign investors with continuous legal advice and update services to ensure their business remains compliant and smoothly progresses in China.

7. Government Relations Coordination: Leveraging the team’s strong relationships with government agencies to assist foreign investors in obtaining support for policy applications and license approvals.

8. Professional Team Support: A team of experienced lawyers provides high-quality legal services to foreign investors.

Typical significance:

The legal team led by Attorney Liu Yu is keenly aware of the various challenges and issues that foreign-invested enterprises may encounter during their operations in China. Therefore, the team not only provides expert support during the establishment phase of a business but also commits to offering ongoing legal services to foreign-invested enterprises. Throughout the course of business operations, the team closely monitors changes in laws and regulations, promptly providing foreign-invested enterprises with legal updates and compliance advice to ensure that their businesses can adapt to the ever-evolving legal landscape of the Chinese market.

Currently, Attorney Liu Yu’s legal team has accumulated extensive and comprehensive professional knowledge and practical experience in helping foreign investors “come in.” We provide full-service support throughout the entire process, safeguarding foreign-invested enterprises that place great emphasis on compliance risk management as they establish operations in China. This ensures that foreign investors can set up their businesses efficiently and conveniently, allowing them to deeply cultivate and develop their presence in China. Our cross-border team not only assists foreign investors in smoothly establishing their operations in China in strict compliance with the law but also offers specialized services for ancillary matters such as tax registration after the foreign-invested enterprise has set up shop. Once the foreign-invested enterprise officially begins operations, we provide comprehensive legal services to ensure its lawful and compliant conduct in China.

In addition, Liu Yu’s legal team places particular emphasis on intellectual property protection. In today’s globally integrated business environment, intellectual property has become an essential component of a company’s core competitiveness. The team provides foreign-invested enterprises with comprehensive intellectual property legal services, including the filing, maintenance, and enforcement of trademarks, patents, and copyrights, thereby ensuring that these enterprises’ innovative achievements receive robust legal protection in China.

In dispute resolution, our team also boasts extensive experience. Whether through litigation, arbitration, or mediation, our team can provide foreign-invested enterprises with efficient and professional dispute-resolution services, helping them respond swiftly to commercial disputes and safeguard their legitimate rights and interests to the greatest extent possible.

The legal team led by Attorney Liu Yu also places great importance on communication and collaboration with clients. Team members possess excellent foreign-language communication skills, enabling them to engage in smooth exchanges with foreign investors and ensuring mutual understanding and seamless cooperation on legal matters. The team regularly organizes legal lectures and seminars, inviting foreign-invested enterprises to participate and share the latest legal developments and practical experience, thereby helping these companies better integrate into the Chinese market.