1. Forms of foreign investment  

Foreign investment in China can be divided into direct investment and other investment forms. The most commonly used form is direct investment, mainly including Sino-foreign joint venture, Sino-foreign cooperative enterprise, wholly foreign-owned enterprise, cooperative development, and BOT, etc. Other investment forms mainly include compensation trade, processing and assembling, and international leasing, etc.  

2. What are the procedures for the establishment of enterprises with foreign investment?  

The establishment of enterprises with foreign investment in China shall comply with Articles 7 to 17 of the Rules for the Implementation of the Law of the People's Republic of China on Foreign-capital Enterprises (revised on April 12, 2001).  

The establishment of Sino-foreign joint ventures and Sino-foreign cooperative enterprises shall be available provided that the project proposal is prepared by Chinese investors, and the project feasibility research report is jointly prepared by both Chinese and foreign investors. For foreign-funded projects, a project report shall be prepared by the local government department which shall specify the necessity of the project construction, possibility of provision of external conditions, etc. Relevant procedures for establishment of enterprises should be handled after being approved by the examination and approval authority.  

For foreign investors, the following documents should be provided:  

1. The authorized certificate signed by the legal representative of the notarized and accredited enterprises.  

2. The balance sheet, etc. of the enterprises in the past two years reviewed and signed by the Certified Public Accountant (CPA).  

3. Notarized and accredited bank deposit certification, proving the deposits amount and recent details of the deposit of enterprises.  

4. Professional technical force, legal documents of patent, etc, of enterprises.  

In addition, due to the difference between the detailed situation and the requirements of various areas, relevant requirements for foreign investors will be slightly different correspondingly. The economic and commercial office of Embassy of PRC in Singapore can provide relevant details of Beijing, Shanghai, Guangzhou, Xi’an, Tianjin and other major cities, which is available for inquiry when necessary.  

3. Which enterprises can be accredited as investment enterprises in Beijing?  

Enterprises conforming to the investment guidance defined in Article 1 and the type and size of enterprises defined in Article 2 of the Provisions on Expanding Opening up to Promote the Development of Economy in Beijing (JYF[2002] No. 12, hereinafter referred to as "the Provisions"), and are established by domestic enterprises and individuals to set up business or set up research and development institutions in Beijing can be accredited as enterprises with investment in Beijing, and is entitled to enjoy the related preferential policies defined in the Provisions.  

I. In terms of defines the following content:  

(I)   Encourage investment to develop high-tech industries, and to transform traditional industries by advanced applicable technology.  

(II)  Encourage investment to develop modern manufacturing industry and urban industries.  

(III) Encourage investment to develop modern service industries such as financial insurance, tourism exhibition, and commercial circulation.  

(IV) Encourage investment to develop modern agriculture.  

(V)  Encourage investment to develop urban infrastructure.  

II. In terms of enterprise type and size, Article 2 of the Provisions defines the following content:  

(I)   Large national enterprises (groups) accredited by the State Council and large enterprises (groups) accredited by central ministries, and the people's government of the provinces, autonomous regions and municipalities, and famous brand enterprises (hereinafter referred to as "Large Enterprises (Groups)") meeting the requirements of the investment guidance defined in Article 1 of the Provisions, with registered headquarters, regional headquarters and marketing center in Beijing;  

(II)  Various financial institutions with registered headquarters, regional headquarters and settlement center in Beijing;  

(III) Investment enterprises in Beijing meeting the requirements of the investment guidance defined in Article 1 of the Provisions, with investment in fixed assets of over RMB 30 million, or with an annual sales income of RMB 300 million for two consecutive years since 2000;  

(IV) Large enterprises (groups), key scientific research institutions and institutions of higher learning establishing national, municipal R&D centers and R&D institutions accredited by relevant municipal authorities in Beijing.  

4. Application procedure for accreditation of investment enterprises in Beijing  

The application for accreditation of investment enterprises in Beijing shall be preliminarily examined by the Beijing Foreign Investment Service Center, and then be approved by Beijing Investment Promotion Bureau. Those accredited investment enterprises in Beijing will be granted with Accreditation Certificate for Investment Enterprises in Beijing by Beijing Investment Promotion Bureau.  

After receiving Application Form for Accreditation of Investment Enterprises in Beijing and relevant materials submitted by investment enterprises in Beijing, the Beijing Foreign Investment Service Center shall check whether the materials are complete. As for those with complete materials, the preliminary examination shall be completed within 15 working days, and those confirmed shall be submitted to the Beijing Investment Promotion Bureau for approval; while those failing to meet the criteria shall be notified to the investment enterprises in Beijing.  

After receiving the preliminary confirmed opinions and relevant materials submitted by the Beijing Foreign Investment Service Center, relevant departments of Beijing Investment Promotion Bureau shall finish the examination and approval in 10 working days, and the Beijing Foreign Investment Service Center shall issue Certificate for Investment Enterprises in Beijing for the confirmed ones to the investment enterprises in Beijing; while those rejected ones shall be notified by Beijing Foreign Investment Service Center to the investment enterprises in Beijing.  

5. Documents to be submitted for accreditation of enterprises applying for investment in Beijing  

For accreditation of enterprises applying for making investment in Beijing, the following materials shall be submitted in addition to the Application Form for Accreditation of Enterprises to Invest in Beijing:  

(1) Instructions on applying for identifying the enterprise as an enterprise to invest in Beijing;  

(2) Introduction to the enterprise;  

(3) Original (for review) and copy (for record) of the certificate of national and municipal R & D center and the R & D institutions identified by the competent authorities of the city;  

(4) Original (for review) and copy (for record) of the duplicate of the business license. Copies of the business licenses of the enterprise' shareholders or the ID card of natural persons (original is required when necessary);  

(5) Articles of association of the headquarters (head office) registered in Beijing as confirmed by Beijing Administration for Industry and Commerce and the letter of agreement of a partnership registered in Beijing;  

(6) Original (for review) and copy (for record) of the business license of its shareholders and the original (for review) and copy (for record) of the ID card of the individual shareholders;  

(7) Evaluation certificate on the fixed assets of the enterprises made by an assets appraisal company acceptable to Beijing finance authorities and selected by lotting;  

(8) Statements of sales income of the enterprise for last two years confirmed by Beijing Municipal Bureau of Statistics (the audit report issued by the accounting firm recognized by Beijing finance authorities);  

(9) Certificate proving the taxation by the enterprise according to law for last two years issued by the tax administration authorities of its location and above the county level;  

(10) Original (for review) and copy (for record) of the verification report of the enterprise on the original registration and change of the registered capital;  

(11) Other materials supporting the enterprise's satisfaction to the identification conditions.  

6. Persons which can be identified as senior officers  

The following persons of the enterprises obtaining the Certificate of Accreditation as Enterprises to Invest in Beijing can be identified as senior officers:  

(1) Among enterprises to invest in Beijing in conformity to the second paragraph of Article 2 of the Several Provisions, chairman, standing deputy chairman, general manager, standing deputy general manager, chief accountant, chief engineer, chief economist of the head office registered in Beijing; manager and standing deputy manager of subsidiary in registered in Beijing.  

(2) Director or head of R&D institutions set up according to independent corporates and meeting the third paragraph of Article 2 of the Several Provisions.  

(3) Individual investors holding more than 30% of shares in the investors in Beijing registered in Beijing Administration for Industry and Commerce and conforming to the second paragraph of Article 2 of the Several Provisions may be treated by reference to senior officers.  

For the number of senior officers of enterprises to invest in Beijing entitled to relevant preferential policies set forth in the Several Provisions, Beijing Investment Promotion Bureau adopts total amount control based on the type, level, scale of investment and operation of the enterprises.  

7. Procedures for applying for accreditation of senior officers  

To apply for accreditation of their senior officers, the enterprises to invest in Beijing shall apply for primary approval with Beijing Foreign-invested Enterprises Service Center, which will be examined and approved by Beijing Investment Promotion Bureau. For approved senior officers, Beijing Foreign-invested Enterprises Service Center will issue a Certificate for Identification as Senior Officers.  

After receiving the Application Form for Identification as Senior Officers submitted by enterprises to invest in Beijing, Beijing Foreign-invested Enterprises Service Center shall check the completeness of the materials; if complete, it shall complete the preliminary review within 15 working days; those in line with the conditions will be submitted to Beijing Investment Promotion Bureau for examination and approval; otherwise, enterprises to invest in Beijing shall be informed.  

After receiving the preliminary opinion and related materials of Beijing Foreign-invested Enterprises Service Center, the competent section and offices of Beijing Investment Promotion Bureau should complete the examination and approval within 10 working days and Beijing Foreign-invested Enterprises Service Center will issue the Certificate for Identification as Senior Officers, or notify the enterprises to invest in Beijing if not approved.  

8. Materials required for applying for accreditation of senior officers  

To apply for accreditation of their senior officers, the enterprises to invest in Beijing shall submit the following materials in addition to the Application Form for Identification as Senior Officers:  

(1) Instructions on applying for identifying senior officers of the enterprises to invest in Beijing;  

(2) The Application Form for Identification as Senior Officers of the enterprises to invest in Beijing;  

(3) Original (for review) and copy (for record) of the Appointment Letter of Senior Officers of the local headquarters and subsidiaries registered in Beijing issued by the headquarters and the head office;  

(4) Original (for review) and copy (for record) of the ID card or valid passport of the senior officers;  

(5) Original (for review) and copy (for record) of the academic certificate, the degree certificate, and title certificate of the senior officers;  

(6) Original (for review) and copy (for record) of the duplicate of the business license of the enterprises or R&D institutions;  

(7) Original (for review) and copy (for record) of the Articles of Association, the partnership agreement providing the contribution of shareholders and actual contribution certificates of the enterprises to invest in Beijing as identified by Beijing Administration for Industry and Commerce;  

(8) Original (for review) and copy (for record) of Certificate of Accreditation as Enterprises to Invest in Beijing and Reply to Accreditation as Enterprises to Invest in Beijing.  

9. Conditions required for senior officers to handle permanent residence in Beijing  

According to Article 25 of the Several Provisions of Beijing Municipality on Expanding Opening-up and Promoting the Economic Development of the Capital (JZF [2002] No.12, hereinafter referred to as the "Several Provisions") , to handle the procedures of permanent residence in Beijing for its senior officers, the enterprises to invest in Beijing shall meet the following conditions:  

(1) The enterprises have obtained the Certificate of Accreditation as Enterprises to Invest in Beijing;  

(2) The senior officers take posts listed in Article 2 of the Measures for Recognizing Enterprises to Invest in Beijing and their Senior Officers and obtain Certificate for Identification as Senior Officers; for the purpose of Article 2, the posts listed refer to:  

10. Among the enterprises to invest in Beijing in conformity to the second paragraph of Article 2 of the Several Provisions, Chairman, standing deputy chairman, general manager, standing deputy general manager, chief accountant, chief engineer, chief economist of the head office registered in Beijing; Manager and standing deputy manager of subsidiary in registered in Beijing.  

2. Director or head of R&D institutions set up according to independent corporates and meeting the third paragraph of Article 2 of the Several Provisions.  

3．Individual investors holding more than 30% of shares in the enterprises to invest in Beijing registered in Beijing Administration for Industry and Commerce and conforming to the second paragraph of Article 2 of the Several Provisions may be treated by reference to senior officers.  

10. Procedures for senior officers to handle permanent residence in Beijing  

(1) The enterprises to invest in Beijing submit the abovementioned materials of the senior officers for applying for primary approval with Beijing Foreign-invested Enterprises Service Center. Beijing Foreign-invested Enterprises Service Center will complete the preliminary review within 15 working days.  

(2) The materials of those enterprises fail the preliminary review will be returned to the declarer by Beijing Foreign-invested Enterprises Service Center; for the materials of enterprises surviving the preliminary review, Beijing Foreign-invested Enterprises Service Center will submit the same to Beijing Investment Promotion Bureau for its approval.  

(3) After receiving the preliminary qualified opinion of Beijing Foreign-invested Enterprises Service Center, the competent sections and offices of Beijing Investment Promotion Bureau will complete review within 10 working days. If the materials fail to be approved, Beijing Foreign-invested Enterprises Service Center will notify the declarer; the materials surviving the review will be submitted by Beijing Foreign-invested Enterprises Service Center to Beijing Municipal Public Security Bureau for handling review and approval procedures.  

(4) After receiving the application materials from Beijing Investment Promotion Bureau, Beijing Municipal Public Security Bureau should complete review and approval within the prescribed period. If it does not approve, it shall return the materials to Beijing Foreign-invested Enterprises Service Center, which shall forward the materials to the applicant; if it approves, it shall submit the ratification opinion, related materials and Certificate for Permanent Residence Relocation to Beijing Foreign-invested Enterprises Service Center, which will forward the same to the applicant; The applicant will handle Certificate for Permanent Residence Relocation procedures with authority in its original domicile with the Certificate for Approval of Permanent Residence Relocation, and then handle the settlement procedures with Beijing Municipal Public Security Bureau by presenting the Certificate for Permanent Residence Relocation.  

11. Materials (in duplicate) required for senior officers to handle permanent residence in Beijing  

(1) Approval to handle the procedures of permanent residence in Beijing by the senior officers of the enterprises to invest in Beijing;  

(2) The Application Registration Form;  

(3) Application for handling the procedures of permanent residence in Beijing by the senior officers of the enterprises to invest in Beijing;  

(4) Original and copy of the duplicate of the business license;  

(5) Articles of association of the headquarters (head office) registered in Beijing and the letter of agreement of a partnership registered in Beijing;  

(6) Original and copy of the Appointment Letter of Senior Officers;  

(7) Original and copy of Reply to Accreditation as enterprises to invest in Beijing and the Certificate of Accreditation of Enterprises Applying for Investment in Beijing;  

(8) Original and copy of the Reply to Accreditation as Senior Officers of the enterprises to invest in Beijing and Certificate for Identification as Senior Officers of the Enterprises to Invest in Beijing;  

(9) Original and copy of the right of the senior officers to own the house located in Beijing; submit the property admission certificate and the settlement admission certificate of local police stations;  

(10) Originals and copies of the ID cards of the senior officers and their accompanying persons;  

(11) Originals and copies of the household registers of the senior officers and their spouses and children;  

(12) Originals and copies of the marriage certificates of the senior officers;  

(13) Originals and copies of the one-child certificates and the birth certificates of the children of the senior officers;  

(14) Two 1-inch bareheaded photos of the senior officers and their accompanying persons (to be posted on the Applicant Registration Form);  

(15) If their spouses relocate with the senior officers, the spouses’ certificates proving the same are required.  

12. Conditions required for the senior officers to handle the procedures of participating in college entrance examination in Beijing for their children   

According to Article 26 of the Several Provisions of Beijing Municipality on Expanding Opening-up and Promoting the Economic Development of the Capital (JZF [2002] No.12), to handle the procedures of participating in entrance examination in Beijing of the children of their senior officers, the enterprises to invest in Beijing shall meet the following conditions:  

(1) The enterprises have obtained the Certificate of Accreditation as Enterprises to Invest in Beijing;  

(2) The senior officers have obtained the Certificate for Identification as Senior Officers;  

(3) The senior officers have obtained the Permit for Employment and Residence in Beijing;  

(4) The children of the senior officers are fresh high school graduates.  

Materials required for handling the procedures of participating in entrance examination in Beijing for their children of the senior officers  

1) The Application Form for Participating in College and Universities Entrance Examination in Beijing by the Children of the Senior Officers of the Enterprises to Invest in Beijing (in quadruplicate);  

2) The Certificate for Identification as Senior Officers of Enterprises to Invest in Beijing issued by Beijing Investment Promotion Bureau;  

3) Original and copy of the Permit for Employment and Residence in Beijing issued by Beijing Municipal Bureau of Personnel.  

Steps to handle the procedures of participating in entrance examination in Beijing for the children of the senior officers  

(1) The enterprises to invest in Beijing shall, at the end of October each year, submit the Application Form for Participating in College and Universities Entrance Examination in Beijing by the Children of the Senior Officers of the Enterprises to Invest in Beijing of the children of the senior officers who will participate in entrance examination in Beijing next year and related materials to Beijing Foreign-invested Enterprises Service Center for preliminary review;  

(2) If Beijing Foreign-invested Enterprises Service Center approves the same in preliminary review, Beijing Foreign-invested Enterprises Service Center will issue the Letter of Introduction for Participating in Entrance Examination in Beijing by the Children of the Senior Officers of the Enterprises to Invest in Beijing, which will be submitted to Beijing Education Examinations Authority together with the Application Form for Participating in College and Universities Entrance Examination in Beijing by the Children of the Senior Officers of the Enterprises to Invest in Beijing.  

(3) After the admissions office of the general institutions of higher education of Beijing Education Examinations Authority issues approval opinion, the candidates can handle the procedures of participating in entrance examination in Beijing with the letter of introduction.  

(4) The preliminary review by Beijing Foreign-invested Enterprises Service Center and the issuance of approval opinion by the admissions office of the general institutions of higher education of Beijing Education Examinations Authority shall complete 10 days before the commencement of examination application procedures in the current year (currently about mid-November in the prior year).