Notice of Guangdong Province Administration for Industry and Commerce on Issuing the Guiding Opinions on Effectively Completing the Registration of Foreign-Invested Enterprises in Guangdong Province after the Reform of the Foreign Investment Approval System

• Document Number：No. 471 [2016] of the Administration for Industry and Commerce of Guangdong Province
• Area of Law： Enterprises
• Level of Authority： Local Regulatory Documents
• Date issued：10-28-2016
• Effective Date：10-28-2016
• Status： Effective
• Issuing Authority： Other Institutions of Guangdong Province

Notice of Guangdong Province Administration for Industry and Commerce on Issuing the Guiding Opinions on Effectively Completing the Registration of Foreign-Invested Enterprises in Guangdong Province after the Reform of the Foreign Investment Approval System
(No. 471 [2016] of Guangdong Province Administration for Industry and Commerce )
All bureaus of industry and commerce above the prefecture level, and the Hengqin New Area Administration for Industry and Commerce; the Market and Quality Supervision Commission of Shenzhen Municipality; the Market Supervision Administration of Shunde District, Foshan City; and the bureaus directly under Guangdong Province Administration for Industry and Commerce:
The Guiding Opinions on Effectively Completing the Registration of Foreign-Invested Enterprises in Guangdong Province after the Reform of the Foreign Investment Approval System are hereby issued for your diligent implementation.
All localities shall report the problems found during the process of implementation to the Enterprise Registration Department (Foreign Investment Department) of Guangdong Province Administration for Industry and Commerce in a timely manner.
Guangdong Province Administration for Industry and Commerce
October 28, 2016
Guiding Opinions on Effectively Completing the Registration of Foreign-Invested Enterprises in Guangdong Province after the Reform of the Foreign Investment Approval System
The Decision of the Standing Committee of the National People's Congress on Amending Four Laws including the Law of the People's Republic of China on Wholly Foreign-Owned Enterprises (hereinafter referred to as the “Decision on Amending Laws,” see Annex 1), as adopted by the Standing Committee of the National People's Congress on September 3, 2016, has amended the relevant provisions on administrative approval in the Law of the People's Republic of China on Wholly Foreign-Owned Enterprises, the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures, and the Law of the People's Republic of China on Chinese-Foreign Contractual Joint Ventures (hereinafter collectively referred to as the “three laws on foreign investment”), and the Law of the People's Republic of China on the Protection of Investments by Taiwan Compatriots (hereinafter referred to as the “Law on Investments by Taiwan Compatriots”), has changed the approval for the formation and modification of foreign-invested enterprise subject to the special administrative measures for the implementation of access as prescribed by the state (hereinafter referred to as the “Special Administrative Measures”) not involving foreign investment to recordation management, and shall come into force on October 1, 2016. On September 30, the State Administration for Industry and Commerce (“SAIC”) issued the Notice on Effectively Completing Relevant Registration Work after Implementing Recordation Administration of Foreign-invested Enterprise (No. 189 [2016], SAIC, hereinafter referred to as the “Notice of the SAIC,” see Annex 2). On October 8, the Ministry of Commerce and other departments issued the Special Administrative Measures for Foreign Investment Access (Announcement No. 22 [2016], NDRC and the MOC, hereinafter referred to as the “Special Administrative Measures,” see Annex 3) and the Interim Measures for the Recordation Administration of the Formation and Modification of Foreign-funded Enterprises (Order No. 3 [2016], MOC, see Annex 4). For the purpose of effectively completing the registration of foreign-funded enterprises in Guangdong province after the reform of the foreign investment approval system, these Guiding Opinions are hereby developed, in accordance with the Decision on Amending Laws and the Notice of the SAIC, and in light of the reality of Guangdong province.
I. Attaching great importance to the significance of the revision and implementation of foreign investment laws
Decision of the Standing Committee of the National People's Congress on Amending Four Laws including the Law of the People's Republic of China on Wholly Foreign-Owned Enterprises (hereinafter referred to as the “Decision on Amending Laws”) is a significant reform of China for the foreign investment management system during the process of exploring and establishing the pre-access national treatment plus negative list management mode for foreign investors in China, and an objective requirement for building a new system of open economy. Having fully reflected the reform direction of simplification of administrative procedures and delegation of powers to lower levels, combination of delegation with administration, and optimization of services of government departments, modifying the approval items not involving Special Administrative Measures to recordation management is the current intrinsic requirement of deepening the reform of the commercial affairs system and continuously improving the business environment. Direct acceptance of applications for the registration of formation and change of foreign-funded enterprises not involving Special Administrative Measures by industry and commerce (market supervision) departments is a new task and new challenge put forward for the industry and commerce (market supervision) departments at the key stage of promoting the reform of the commercial affairs system in an in-depth manner. The industry and commerce (market supervision) departments at all levels shall attach great importance to the significance of the “Decision on Amending Laws,” comprehensively implement the “Decision on Amending Laws,” and diligently and effectively complete the work of enterprise registration after the reform of the foreign investment approval system, with the work attitude and sense of responsibility of “the registration of foreign investment is vital.”
II. Uniformly standardizing the registration of foreign-invested enterprises
1. Registration jurisdiction. The provincial administration for industry and commerce, all industry and commerce (market supervision) bureaus at or above the prefecture-city level (including the Market Supervision Administration of Shunde District, Foshan City), and some industry and commerce (market supervision) bureaus at the county level authorized by the SAIC are the registration authorities for foreign-funded enterprises in Guangdong province (hereinafter referred to as the “authorized foreign investment bureaus”).
When a foreign-funded enterprise undergoes the formalities of formation, modification (recordation), and deregistration, where an application for registration does not involve the Special Administrative Measures, territorial jurisdiction shall be implemented in principle, and the authorized foreign investment bureau at the most grass-roots level in the place where the foreign-funded enterprise is located shall be responsible for handling the case; and where the Special Administrative Measures are involved, hierarchical jurisdiction shall be continuously implemented in principle.
Where a Hong Kong service supplier invests in the service sector under the Agreement on Trade in Services to the Mainland and Hong Kong Closer Economic Partnership Arrangement and a Macao service supplier invests in the service sector under the Agreement on Trade in Services to the Mainland and Macao Closer Economic Partnership Arrangement (hereinafter collectively referred to as the “Agreements on Trade in Services to the CEPA”), the authorized foreign investment bureau at the most grass-roots level in the place where the foreign-funded enterprise is located shall, in principle, be responsible for the handling of the formation, modification (recordation), and deregistration of the company. The authorized foreign investment bureau at or above the prefecture-city level shall be responsible for handling the matters of a foreign-funded joint stock company.
The formation, modification (recordation), and deregistration of foreign-funded enterprises in China (Guangdong) Pilot Free Trade Zone shall continue to be governed by the original jurisdiction provisions.
2. Registration and approval (ex ante recordation). When an authorized foreign investment bureau handles the formation, modification (recordation), and deregistration of a foreign-funded enterprise, where an application for registration does not involve the Special Administrative Measures, registration shall be directly handled according to the law and the approval documents or recordation documents of the competent commerce department are not required to be collected; and where the Special Administrative Measures are involved, an authorized foreign investment bureau shall collect the approval documents of the competent commerce department (only be limited to the formation, modification registration, or deregistration applied for during the period of the lawful existence of the enterprise), before handling the registration.
Where a Hong Kong or Macao service supplier invests in the service sector under the Agreements on Trade in Services to the CEPA, when its company handles formation, modification, or deregistration (only be limited to the handling of deregistration during the period of lawful existence), an authorized foreign investment bureau shall collect the investment recordation document of a Hong Kong or Macao service supplier issued by the competent commerce department according to the law.
Where a foreign-funded enterprise registered in China (Guangdong) Pilot Free Trade Zone invests in a project in the negative list for pilot free trade zones (to be governed by the Notice of the General Office of the State Council on Issuing the Special Administrative Measures (Negative List) for Foreign Investment Access in Pilot Free Trade Zones (No. 23 [2015], General Office of the State Council), here and below), an authorized foreign investment bureau shall, when handling formation, modification, and deregistration (only be limited to the handling of deregistration during the period of lawful existence), collect the approval documents of the competent commerce department according to the law; and where investment is made in a project other than those listed in the negative list for pilot free trade zones, an authorized foreign investment bureau shall directly handle registration and is not required to collect the recordation documents of the competent commerce department.
3. Application of law. In accordance with the Decision on Amending Laws, the Company Law of the People's Republic of China, and the relevant provisions of the state, registration management of foreign-funded enterprises shall be conducted under the following principles of law application: where there are provisions in the “three laws on foreign investment” and the “Law on Investments by Taiwan Compatriots,” these provisions shall be applied; and where there are no provisions, the relevant provisions of the Company Law of the People's Republic of China and the Regulation of the People's Republic of China on the Administration of Company Registration shall be applied. Where there are no provisions in the aforesaid laws or administrative regulations, the relevant administrative regulations on foreign-funded enterprises, decisions of the State Council, and other provisions of the state on foreign investment shall be applied.
4. Business scope.
(1) The business scope of a foreign-funded enterprise not involving the Special Administrative Measures.
Where the business scope of a foreign-funded enterprise does not involve the Special Administrative Measures, but falls into the encouraged projects of the Catalogue of Industries for Guiding Foreign Investment (2015 Revision, here and below), the authorized foreign investment bureau shall handle registration as the “Catalogue of Encouraged Industries for Foreign Investment” in the Catalogue of Industries for Guiding Foreign Investment.
Where the business scope of a foreign-funded enterprise does not involve the Special Administrative Measures, but falls into the permitted projects of the Catalogue of Industries for Guiding Foreign Investment, the authorized foreign investment bureau shall handle registration with reference to the National Industries Classification; and for emerging industries that are not prescribed in the National Industries Classification, registration shall be handled with reference to the policy documents, industry habits, or professional literatures.
When an aforesaid foreign-funded enterprise handles registration, the authorized foreign investment bureau shall add “(the aforesaid project does not involve the Special Management Measures for Foreign Investment Access)” in the column of “business scope” as specified in its business license, and collect the Commitment Letter of Foreign-invested Enterprise (See Annex 5).
(2) The business scope of a foreign-funded enterprise involving the Special Administrative Measures. Where the business scope of a foreign-funded enterprise involves the Special Administrative Measures, the authorized foreign investment bureau shall handle registration according to the approval documents of the competent commerce department.
(3) The business scope of a foreign-funded enterprise formed by a Hong Kong or Macao service supplier only under the Agreements on Trade in Services to the CEPA. Where a Hong Kong or Macao service supplier invests in a service sector under the Agreements on Trade in Services to the CEPA, the business scope of a foreign-funded enterprise formed thereby shall be registered by the authorized foreign investment bureau under the recordation documents of the competent commerce department.
(4) The business scope of a foreign-funded enterprise formed in China (Guangdong) Pilot Free Trade Zone. Where the business scope of a foreign-funded enterprise formed in China (Guangdong) Pilot Free Trade Zone involves the projects in the negative list for pilot free trade zones, the authorized foreign investment bureau shall, according to the approval documents of the competent commerce department, handle registration; where the negative list is not involved, the authorized foreign investment bureau shall handle registration according to the National Industries Classification; and for emerging industries that are not prescribed in the National Industries Classification, registration shall be handled with reference to the policy documents, industry usage, or professional literatures.
5. Business period. Where the business period of a foreign-funded enterprise does not involve the Special Administrative Measures, the authorized foreign investment bureau shall handle registration within the business period as specified in the articles of association of the enterprise, and where it is otherwise prescribed by laws and administrative regulations, these provisions shall be followed; and where the Special Administrative Measures are involved, the authorized foreign investment bureau shall handle registration within the business period as specified in the approval documents of the competent commerce department.
Where a Hong Kong or Macao service supplier invests in a service sector under the Agreements on Trade in Services to the CEPA, the authorized foreign investment bureau shall handle registration within the business period under the recordation documents of the competent commerce department.
Where a foreign-funded enterprise in China (Guangdong) Pilot Free Trade Zone invests in a project in the negative list for pilot free trade zones, the authorized foreign investment bureau shall handle registration within the business period as specified in the approval documents of the competent commerce department; and where an enterprise invests in a project other than those listed in the negative list, the authorized foreign investment bureau shall handle registration within the business period as specified in the articles of association of the enterprise.
6. Proportion of registered capital to total investment. When handling the registration of a foreign-funded enterprise, the authorized foreign investment bureau shall, under the provisions of the Interim Provisions of the State Administration for Industry and Commerce on the Proportion of the Registered Capital of a Chinese-Foreign Equity Joint Venture to Its Total Investment (No. 38 [1987], SAIC), implement the relevant provisions on the proportion of the registered capital of a foreign-funded enterprise to its total investment.
7. Articles of association. The authorized foreign investment bureau shall conduct formal examination of the articles of association of a foreign-funded enterprise according to the law and shall request an applicant to make corresponding amendments to those failing to be in line with the provisions of the laws, administrative regulations, and rules.
8. Registration procedures. The authorized foreign investment bureau shall, according to the registration procedures and the registration period as prescribed in the Regulations of Guangdong Province on Commercial Registration, handle registration of foreign-funded enterprises according to the law; and shall conduct formal examination according to the law and effectively guarantee the standardization of the registration procedures and the unity of the examination standards, under the principle of consistent standards for domestic enterprises and foreign-funded enterprises.
9. Registration of the branch offices of foreign-funded enterprises. After the reform of the foreign investment approval system, the authorized foreign investment bureau shall continue to directly handle registration of the branch offices of foreign-funded enterprises (except franchise).
Where a branch office of a foreign-funded enterprise engages in commercial retailing and franchise, the authorized foreign investment bureau shall, when handling registration, collect the approval documents of the competent commerce department.
10. Other rules.
(1) Linkage between new rules and old rules. Where an applicant has obtained the approval documents of the competent commerce department before October 1, 2016, but applies to the authorized foreign investment bureau for registration after October 1, 2016, the authorized foreign investment bureau shall handle it according to the provisions of the original “three laws on foreign investment” and the “Law on Investments by Taiwan Compatriots.”
(2) Modifying domestic enterprise to foreign-funded enterprise. Where a domestic enterprise is modified to foreign-funded enterprise in the form of mergers and acquisitions by foreign investors, the authorized foreign investment bureau shall, when handling registration, collect the approval documents of the competent commerce department according to the law.
(3) Modifying a foreign-funded enterprise to domestic enterprise. Where a foreign-funded enterprise is modified to domestic enterprise, and the original foreign-funded enterprise involves the Special Administrative Measures, the authorized foreign investment bureau shall, when handling registration, collect the approval documents of the competent commerce department according to the law; and where the original foreign-funded enterprise does not involve the Special Administrative Measures, the authorized foreign investment bureau shall directly handle registration and is not required to collect the recordation documents of the competent commerce department.
(4) Registration of the domestic investments of foreign-funded enterprises. Where a foreign-funded enterprise makes domestic investment, the investee is a domestic enterprise. Where the business scope of an investee is an encouraged or permitted project of the Catalogue of Industries for Guiding Foreign Investment, the company registration authority shall directly handle registration; and where the business scope of an investee involves the restricted project, the company registration authority shall, when handling registration, collect the approval documents of the competent commerce department. No foreign-funded enterprise shall invest in areas in which foreign investment is prohibited.
(5) Registration of equity pledge of foreign-funded enterprises. According to the Measures for the Registration of Equity Pledge with the Administrative Organs for Industry and Commerce (revised by the Order No.86 of the State Administration for Industry and Commerce), the authorized foreign investment bureau is not required to collect the recordation documents of the competent commerce department, when handling the registration of equity pledge of foreign-funded enterprises.
III. Promoting the registration of enterprises after the reform of the foreign investment approval system in an overall manner
1. Strengthening publicity and guidance. The provincial administration for industry and commerce has incorporated the Special Administrative Measures into the business system, has accordingly revised the specifications on the registration of foreign-funded enterprises, and has uploaded the relevant publicity and interpretation materials and updated the registration guidelines at the portal of the Guangdong Province Administration for Industry and Commerce. All localities shall, by multiple ways and through various media, publicize and interpret the Decision on Amending Laws, the three laws on foreign investment, the Law on Investments by Taiwan Compatriots, the Special Administrative Measures, the Catalogue of Industries for Guiding Foreign Investment, and other relevant policies on foreign investment, answer and respond to the hot issues of the concern to enterprises and the public in a timely manner, direct foreign investors and foreign-invested enterprises to correctly identify different management requirements and registration process of foreign investment access, and ensure the smooth implementation of the new rules on the management of foreign-funded enterprises.
2. Strengthening business guidance. All localities shall organize and carry out study and training on foreign investment laws, regulations, rules and policy documents, as well as the registration specifications after the reform, effectively raise the business capacity of the registration staff members for serving foreign-funded enterprises, diligently collect the problems arising from the registration work, study and resolve the problems in a timely manner, and effectively complete follow-up and guidance.
3. Strengthening communication and consultation. All localities shall strengthen the communication and consultation with the industry and commerce (market supervision) departments at a higher level and the development and reform, commerce, customs, and other departments at the same level, actively solicit the opinions of the development and reform, commerce, customs, and other departments for doubts on whether the application issues of foreign-funded enterprises involve the Special Administrative Measures, and effectively protect the national industrial safety.
4. Strengthening information sharing. All localities shall comprehensively and accurately record the registration information of foreign-invested enterprises, and publicize them in the Credit Information Disclosure System for Enterprises Nationwide and the platform for sharing of enterprise information, for inquiry, claiming, and effective completion of follow-up supervision work by other administrative departments.
Enterprises invested by Taiwan compatriots, Hongkong and Macao compatriots shall be governed, mutatis mutandis to, the aforesaid requirements.
Annexes: 1. Decision of the Standing Committee of the National People's Congress on Amending Four Laws including the Law of the People's Republic of China on Wholly Foreign-Owned Enterprises (Adopted at the 22nd Session of the Standing Committee of the Twelfth National People's Congress on September 3, 2016)
2. Notice of the State Administration for Industry and Commerce on Effectively Completing Relevant Registration Work after Implementing Recordation Administration of Foreign-invested Enterprise (No. 189 [2016], State Administration for Industry and Commerce)
3. Interim Measures for the Recordation Administration of the Formation and Modification of Foreign-funded Enterprises (Order No. 3 [2016], Ministry of Commerce)
4. Announcement No. 22 [2016] of the National Development and Reform Commission and the Ministry of Commerce and Special Management Measures for Foreign Investment Access
5. Commitment Letter of Foreign-invested Enterprise
6. Interpretation of Policies on and Answers to Questions of Registration of Foreign-invested Enterprises after the Reform of the Foreign Investment Approval System