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Step 1: Application for Approval

Upon reaching agreement by the parties to an equity or contractual JV after negotiation, parties to the JV should work together to compile a feasibility study report and sign the contract, articles of association and other relevant legal documents for establishing the JV. The Chinese party should then submit the documents to the local foreign trade and economic cooperation department where the JV is located for approval. For projects under the encouraged and permitted categories with an investment exceeding US$100 million as well as projects under the restricted category with an investment exceeding US$50 million, report has to be made to the local development and reform commission, and projects that require approval from the relevant industry department have to be reported to that industry department also.

Documents required: Application letter to the competent Chinese authorities; feasibility study report duly signed by all parties to the JV; application for registration of the name of the enterprise approved by the provincial or municipal administration for industry and commerce; written comments on the project by various government departments such as environmental protection, fire services, health and land administration; business licences of the parties concerned and certificates of their legal representatives; credit report on the foreign party prepared by the bank; contract and articles of association duly signed by the legal representatives of the JV parties; and list of board of directors.

Step 2: Application for Approval Certificate

After the feasibility study report, the contract and articles of association are approved, the Chinese party should apply to the provincial or municipal foreign trade and economic cooperation department for an approval certificate.

Documents Required: Ratification documents (on project proposal, feasibility study report, contract and articles of association) from the relevant authorities.

Step 3: Registration

Upon collection of the approval certification issued by the relevant authority, an application for business licence should be filed with the provincial or municipal administration for industry and commerce within 30 days. Subsequently, the JV 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.