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Setting a business in Hainan is really a good investment choice for investors both at home and abroad. According to recently released official news, China aims to establish a free trade zone in Hainan by 2020 and will encourage multinationals to set up their international and regional headquarters there, as part of plans to open up the province's economy to foreign investors. Therefore, it’s indeed a good chance for investors. In the below exposition, Tannet mainly introduce some of the requirements on business setup in Hainan.
I. Company Name
In China, the importance of finding the right name is as true for companies as for individuals, as highlighted by name approval being the first step in establishing a company in China. As one of the necessary element, an enterprise name shall be clearly marked on the business license in China. Enterprises shall choose their own names according to China Company Law and apply for China company formation.
II. Business Scope
In China, a company’s operations are defined by its business scope, a one-sentence description of the industry(s) it is authorized to operate in. Choosing a business scope is done at the beginning of the registration process.
What companies need to know is that they can only pursue the items listed on the business scope. Failing to be compliant to the business scope can imply a fine up to one year’s revenue. Additionally Foreign invested enterprises, in short, FIE, are only permitted to issue invoices in consistence with their registered business scope. If a company provides services outside of its defined scope of activities, then it will be unable to issue invoices for those particular services.
III. Registered Capital
One of the basic checks you may make about a Chinese company is to look up how much capital it was registered with. Proving a substantial amount of allocated capital is a requirement for registering a business in China, with the aim of ensuring that the company will be adequately funded and able to operate as described. If you’re considering doing business with a Chinese company such as a manufacturer, checking the registered capital may be beneficial.
Under the provisions of the company law:
1) The minimum registered capital of limited company with 2 or more than 2 persons is RMB30,000;
2) The minimum registered capital of limited company with 1 person is 100,000.
This rule applies to the vast majority of companies registered in China.
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If you have further queries, please contact Tannet
Malaysia hotline：603-21418908;
Hong Kong hotline：852-27837818;
China hotline：86-755- 36990589;
Email: mytannet@gmail.com
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