Register Foreign-Invested Commercial Enterprise( "FICE" ) in China

[b]Introduction of Foreign-Invested Commercial Enterprise( "FICE" ) [/b]k,jz:@
|8v_7Z`
-- Obtain trading and distribution rights in China
)gV J(e3{-Sfc-YV
c5I,D'aQ(C R9V Before 11th December 2004, Foreign-invested enterprises (FIEs), i.e. enterprises established by foreign investors in China (including wholly foreign-owned enterprises [WFOEs] or joint ventures [JV]) were only permitted to import raw materials and semi-manufactures for their own use and to export self-manufactured products directly. In this sense, FIEs generally were not permitted to trade in other products, including products manufactured by their parents and affiliates, causing inefficiencies by compelling the use of oligopolistic trading intermediaries.
p+Dj
Kko*Z!@6H
.QQ&I|Lo But on 16th April 2004, the new Measures for Foreign Investment in Commerce (MFIC) was promulgated by Ministry of Commerce of the People's Republic of China (MOFCOM). According to the Measures, Foreign-invested commercial enterprises (FICEs, one type of FIE) can distribute imported and locally manufactured products through their own wholesale, retail and franchise systems and to provide a host of related services, including storage, warehousing and garage services, inventory management, repairs, maintenance, training and delivery after December11, 2004. It's considerable progress in the implementation of China's WTO commitment to allow foreign-invested enterprises (FIEs) to exercise trading and distribution rights.9q$dof$R
%U3^Xw#K \:_ |WP
Overall, Foreign companies now may choose one of two ways to acquire trading and distribution rights. They can set up a new, standalone foreign-invested commercial enterprises (FICE) or apply to expand the business scope of an existing FIE. Existing manufacturing FIEs, free-trade zone trading FIEs, investment companies, and regional headquarters FIEs may all apply to expand their business scopes.
U'J;ww6c n|.B T[ s"X ([%J/P(O,Q4A(|M/P9l
Following are the updated policy of trading and distribution rights:~E;t'D;f

!N3u cCy@)d!n [table=98%][tr][td=1,4,14%][b]Trading Rights[/b][/td][td=1,1,21%]Opening Time[/td][td=1,1,65%]From 1st July 2004, FIEs can obtain Import/Export license[/td][/tr][tr][td=1,1,21%]Business Scope[/td][td=1,1,65%]Import/Export product or technology[/td][/tr][tr][td=1,1,21%]National treatment[/td][td=1,1,65%]Have the national treatment on "Internal sale"; "Offering for sale"; "Purchase"; "Transportation"; "Distribution"; "Using" or "Directly access to end-users"[/td][/tr][tr][td=1,1,21%]Investment Capital[/td][td=1,1,65%]Minimum 1 million RMB (around 140,000USD$)[/td][/tr][tr][td=1,4,14%][b]Distribution Rights[/b][/td][td=1,1,21%]Opening Time[/td][td=1,1,65%]From 11th Dec, 2004 all the restriction removed[/td][/tr][tr][td=1,1,21%]Business Scope[/td][td=1,1,65%]Wholesale, retail and franchise[/td][/tr][tr][td=1,1,21%]Still under restriction[/td][td=1,1,65%]Books, newspapers, journals, pharmaceuticals, chemical fertilizers, pesticides, mulching films, processed and crude oil, motor vehicles, grain, vegetable oil, sugar and cotton[/td][/tr][tr][td=1,1,21%]Investment Capital[/td][td=1,1,65%]Minimum 500,000 RMB (around 65,000USD$) for the wholesale; Minimum 300,000 RMB (around 38,000USD$) for the retail[/td][/tr][/table]
:y/s%zv(z2?Cx 4Q
R|YfDZV
[b]Details of establishing a FICE under the Measures[/b]
)O(NM/k]3S?S
M
{W\8?&\ [u]1. Definition of a Foreign Invested Commercial Enterprise (FICE) under the Measures
&Qg$YI*Q9JkFy [/u]
ue9WKG#R A foreign invested commercial enterprise means a foreign invested enterprise, which engages in following areas:6nK9C o?"J"@U
[table=98%][tr][td=1,1,20](A)[/td][td]Agency with commission: selling other owned goods and providing related services by sales agency of goods, broker, or auctioneer or other wholesaler on the basis of contractual relationship.[/td][/tr][tr][td=1,1,20](B)[/td][td]Wholesale: selling goods and providing related services to retailer, industrial user, commercial user, organizational user and other wholesaler.[/td][/tr][tr][td=1,1,20](C) [/td][td]Retail: selling goods and providing related services to individual or collective consumer in fixed locations or by means of television, telephone, internet and automat.[/td][/tr][tr][td=1,1,20](D)[/td][td]Franchise: licensing of trademark, trade name and business mode by entering into a contract with others for the purpose of returns and license fee..N0am0K}x_
[/td][/tr][/table]
}l)htb.D [u]2. Business scope of a FICE[/u]
,K{V1ClWqH qc9^cbB6i
[table=98%][tr][td=1,1,20](A)[/td][td]A FICE in retail can engage in following businesses upon approval: Retail/Import of self-operation goods/Purchase and export of domestic goods/other related services.[/td][/tr][tr][td=1,1,20](B)[/td][td]A FICE in wholesale can engage in following businesses upon approval: Wholesale/Agency with commission/Import and Export/ other related services.[/td][/tr][/table]L
aI,d2TD!J)E
[u]3. Requirements for establishing a FICE[/u]2c4]'bmKH*Q}j

?:LMmcAkOW [table=98%][tr][td=1,1,20](A)[/td][td]Minimum registered capital shall be in compliance with respective requirements in company law of PRC.[/td][/tr][tr][td=1,1,20](B)[/td][td]Other requirements with respect to registered capital and investment amount of FIE shall be satisfied (registered capital for a FICE shall be RMB 500,000.00 according to company law and Rules for the Implementation of the Law of the People's Republic of China on Foreign-Capital Enterprises).[/td][/tr][tr][td=1,1,20](C) [/td][td]The general period of operation of a FICE shall not exceed 30 years, and the general period of operation of FICE located in the middle and western region shall not exceed 40 years.[/td][/tr][/table]4_yJP|E(Wh f
The statistics shows that over 600 applications for establishing FICE in Shanghai got approved between January 2006 and July 2006, Compare to last year, it's total 600 FICEs have been approved in whole year. The FICE applications really increased a lot in this year. Special for some famous international brand, like ZARA a famous fashion brand from Spain, Her turnover reaches 3,500,000RMB during the Chinese golden week (1st of May to 7th of May) and now GAP from USA, H&M from Sweden and C&A from German all get approved to establish FICE in Shanghai.

Documents Required & Registration Procedures of FICE

[u]Condition(s):
Oob!Y,i4~ 8g {hk0lN
[/u]Wholesale FICE's minimum captial: USD$65,000
.L'UGyp Retail FICE's minimum captial: USD$38,000G5Q$iSE5@0y
Obtaining the import/export license and VAT invoice recommend captial: USD$140,000N
k?8? Gw
.L!\M,rQFjCC
[u]Documents Required[/u]
e,r@2s&gIP-q @"A4D;Q g0vd"z
The documents required for setting up a FICE are listed below:&m ri!|LE_:]e?]
[table=98%][tr][td=1,1,4%][i][b]01[/b][/i][/td][td=1,1,96%]Copy of Business License of parent foreign company which was certificated by Chinese Embassy (if it's personal investor, then passport copy certificated by Chinese Embassy is enough)[/td][/tr][tr][td=1,1,4%][i][b]02[/b][/i][/td][td=1,1,96%]The lastest annual audit report from the parent foreign company. The audit report should be in the format as prepared by a Certified Public Accountant (CPA)[/td][/tr][tr][td=1,1,4%][i][b]03[/b][/i][/td][td=1,1,96%]2 Credit letters from foreign company banker to declare a good credit within at least current 6 month[/td][/tr][tr][td=1,1,4%][i][b]04[/b][/i][/td][td=1,1,96%]The parent company's legal representative's passport copy[/td][/tr][tr][td=1,1,4%][i][b]05[/b][/i][/td][td=1,1,96%]Shanghai FICE legal representative's passport copy and resume[/td][/tr][tr][td=1,1,4%][i][b]06[/b][/i][/td][td=1,1,96%]Catalogues of import & export[/td][/tr][tr][td=1,1,4%][i][b]07[/b][/i][/td][td=1,1,96%]Authorization letter from parent company[/td][/tr][tr][td=1,1,4%][i][b]08[/b][/i][/td][td=1,1,96%]Brief introduction of the foreign investor(s) including name, address and telephone number [/td][/tr][tr][td=1,1,4%][i][b]09[/b][/i][/td][td=1,1,96%]Registered address, leasing contract, certificate of real estate, and certificate for leasing ( We can provide free virtual address for the registration upon your request, no need to rent an office in advance)[/td][/tr][/table]_Y g!v7i6vHy
[u]Registration Procedures[/u]X p W6]&S:af

Qyrb+gP#Ubk[L
Foreign companies are not allowed to directly submit the application documents to the relevant authority. They must retain a PRC entity that is authorized or permitted by relevant authorities to act as a sponsor. The sponsor will submit all the documents to the examination and approval authority on behalf of the foreign enterprise. Procedures to set up the Foreign-Invested Commercial Enterprise( "FICE" ) in Shanghai are as following:
C.y-|!k9U0E [table=98%][tr][td=1,1,4%][i][b]01[/b][/i][/td][td=1,1,96%]Company Name Registration (about 3 days)[/td][/tr][tr][td=1,1,4%][i][b]02[/b][/i][/td][td=1,1,96%]Apply for Approval Certificate (about 15-30 days)[/td][/tr][tr][td=1,1,4%][i][b]03[/b][/i][/td][td=1,1,96%]Apply for Business License (about 15 days)[/td][/tr][tr][td=1,1,4%][i][b]04[/b][/i][/td][td=1,1,96%]Apply for Enterprise Code Certificate (about 1 day)[/td][/tr][tr][td=1,1,4%][i][b]05[/b][/i][/td][td=1,1,96%]Apply for Statistic license (about 1 day)[/td][/tr][tr][td=1,1,4%][i][b]06[/b][/i][/td][td=1,1,96%]Register in Shanghai Tax Bureau (about 1 month)[/td][/tr][tr][td=1,1,4%][i][b]07[/b][/i][/td][td=1,1,96%]Open a RMB bank account (about 5 days)[/td][/tr][tr][td=1,1,4%][i][b]08[/b][/i][/td][td=1,1,96%]Register Foreign Currency Certificate (about 1 day)[/td][/tr][tr][td=1,1,4%][i][b]09[/b][/i][/td][td=1,1,96%]Check the registered capital (about 5 days)[/td][/tr][tr][td=1,1,4%][i][b]10[/b][/i][/td][td=1,1,96%]Obtain the Import/Export license and VAT invoice (Optional, about 1 month)[/td][/tr][tr][td=1,1,4%][i][b]11[/b][/i][/td][td=1,1,96%]Register in the shanghai custom (about 5 days)[/td][/tr][/table]

Fee for FICE Registration (Based in Shanghai) [FYI]

[u]Government Fee:o IA~N [V G
zr;a!wH-\P
[/u][table=98%][tr][td=1,1,65%][b][color=black]Procedures[/color][/b][/td][td=1,1,35%][b][color=black]Government Fee(RMB)[/color][/b][/td][/tr][tr][td=1,1,65%]Company name approval[/td][td=1,1,35%]80[/td][/tr][tr][td=1,1,65%]Company approval[/td][td=1,1,35%]10[/td][/tr][tr][td=1,1,65%]Company bulletin[/td][td=1,1,35%]4000[/td][/tr][tr][td=1,1,65%]Company registration(base on USD$200,000 captial)[/td][td=1,1,35%]1333[/td][/tr][tr][td=1,1,65%]Business IC card[/td][td=1,1,35%]280[/td][/tr][tr][td=1,1,65%]Company Seal[/td][td=1,1,35%]500[/td][/tr][tr][td=1,1,65%]Organization Code license[/td][td=1,1,35%]228[/td][/tr][tr][td=1,1,65%]RMB currency a/c IC card[/td][td=1,1,35%]250[/td][/tr][tr][td=1,1,65%]Foreign currency a/c IC card[/td][td=1,1,35%]250[/td][/tr][tr][td=1,1,65%]Tax registration[/td][td=1,1,35%]100[/td][/tr][tr][td=1,1,65%]Import/Export license and VAT invoince[/td][td=1,1,35%]3000[/td][/tr][tr][td=1,1,65%]Custom registration[/td][td=1,1,35%]175[/td][/tr][tr][td=1,1,65%]Check captial(base on USD$200,000 captial)[/td][td=1,1,35%]3000[/td][/tr][tr][td=1,1,65%]Statistical license[/td][td=1,1,35%]20[/td][/tr][tr][td=1,1,65%]Finance license[/td][td=1,1,35%]20[/td][/tr][tr][td=1,1,65%][b]Total:[/b][/td][td=1,1,35%][b]13246RMB (~USD$1658)[/b][/td][/tr][/table]
8R_xz d4~ DISCLAIMER: The official registration filing fees above are subject to change without notice. We get our information directly from the government. We do our best to keep our web site up to date. The accurate amount will be billed separately with supporting official receipt issued by the Chinese Government.
n"^)]sN4R ?9A W Q6R&uR!I
[u]Service Fee: [/u]RA I2D*cw L
FICE Registration Service Fee: USD$2600
*i'k
e(hp;\%f
I [z Sg [.T!RG4fk [b]Please check with your service provider in detail, the above data is FYI only[/b]