OVERVIEW OF JV

JV means the joint venture enterprise, which is qualified as Chinese legal corporation and jointly invested by the company, enterprise and other economic organization or individuals from a foreign firm （ include Hong Kong, Macao or Taiwan ） , and the company, enterprise and other economic organization in mainland of China.

A joint venture is a legal organization that takes the form of a short term partnership in which the persons jointly undertake a transaction for mutual profit. Generally each person contributes assets and share risks. Like a partnership, joint ventures can involve any type of business transaction and the "persons" involved can be individuals, groups of individuals, companies, or corporations.

Joint ventures are also widely used by companies to gain entrance into foreign markets. Foreign companies form joint ventures with domestic companies already present in markets the foreign companies would like to enter. The foreign companies generally bring new technologies and business practices into the joint venture, while the domestic companies already have the relationships and requisite governmental documents within the country along with being entrenched in the domestic industry.

ADVANTAGES OF JV

From the angle that foreign businessman make the investment , set up advantage of overseas-funded enterprise as follows, 1, resource-sharing, have complementary advantages; 2, Have independent taking care of oneself and declaring right at the Customs , enjoy the favour in the equipment and goods imports and exports; 3, Enjoy three minus two and avoid the preferential policy; 4, Have the ability to launch the business formally , but needn't there are a great deal of restrictions like office; 5, Utilizing Chinese resources directly, it is very fast to start.

BUSINESS SCOPE

One of the most important issues covered in the project documentation is the business scope of the JV. Business scope is narrowly defined for all businesses in China and the JV can only conduct business within its approved business scope, which ultimately appears on the business license. Amending the business scope requires further application and approval. Inevitably, there is a negotiation with the approval authorities to approve as broad a business scope as is permitted. General business scope usually includes, investment consulting, international economic consulting, trade information consulting, marketing and promotion consulting, corporate management consulting, technology consulting, manufacturing, etc. Back