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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.
INCENTIVES TO WHICK SZ IS EXCLUSIVELY ENTITLED
As well as a set of nationally applicable preferences, foreign investors in Shenzhen enjoy a package of exclusive incentives:
1. While corporate income tax stands at 15%, a three percentage of local income tax is also exempted.
2. Export companies at the expiration of tax exemption and reduction period enjoy a reduced rate of 10% for income tax provided the export volume accounts for 70% of the total industrial output. Local enterprises using state-of-the-art technology at the expiration of tax exemption and reduction period are entitled to a reduced tax rate of 10% for a 3-year extension.
3. Foreign invested operations engaged in high-tech industries are free of income tax for 2 years and enjoy half reduction for the ensuing 8 years. Having successfully absorbed the related technologies and started production, the high-tech projects are given3 years of income tax exemption on the profit hitherto made regardless of previous tax incentives.
4. The VAT of high-tech businesses (projects) with foreign investment is computed against last year's figure and 50% of the local portion of the newly added VAT shall be returned to the enterprise by the municipal financial department.
5. Newly-established foreign invested enterprises with an export orientation need only pay half of the land use fee for industrial purposes. The same is true of certified projects involving update technology for a span of 5 years. As for the land used by high-tech businesses (projects) no fee is collected from the transfer of land-use rights.
6. The manufacturing and operation sites newly built or purchased by high-tech enterprises are free of property tax for 5 years. Other projects enjoy a 3-year exemption from property tax.
7. Technological achievements counted as contribution by companies with limited liability can take up as large a proportion as 35% of its registered capital pending certification of high-tech status by the Municipal Bureau of Science and Technology.
8. Overseas-based Chinese students and professionals intent on starting technology-intensive entities in Shenzhen may transcend the residence inadequacies of the shareholder. Payment of registered capital can take the form of installments in two years in cases where it fails to be an once-off placement.
9. Encouraging domestic and overseas venture investment bodies to make their presence in Shenzhen. Given local registration and a minimum investment ratio of 70 percent in the hi-tech sector, such investment entities are entitled to all the tax holidays and other incentives enjoyed by the hi-tech firms. A 3 percent to 5 percent of the year?|s total profit can be withdrawn as risk compensation fee to make up for the loss incurred during the previous year and the current year. The remaining amount of the risk compensation fee is settled on an annual basis provided the sum does not exceed 10 percent of the net assets of the company.
10. H-tech companies run by foreign investors (including those from HK, Macao and Taiwan) can be registered as domestic-funded ones if their capital contribution is below 25 percent of the registered capital.
11. Foreign investment in the local service sector exceeding US$ 5 million with a business tenure of at least 10 years is entitled to income tax exemption for the first profit-making year and half reduction for the second and third years.
12. Foreign banks or sino-foreign equity joint venture banks in Shenzhen are exempt from business tax for 5 years commencing on the date of opening.
13. Goods made and sold locally are free of VAT in the production process.
14. Goods imported by foreign invested enterprises engaged in export processing businesses are exempt from import-related VAT and consumption tax.
15. Processing businesses undertaken by enterprises or commercial entities with import-export license and certified qualifications for processing and assembly operation are free of consumption tax as well as VAT levied on the industrial fees.
16. Industrial fees derived from processing businesses by commercial entities for all types of processing enterprises are free of VAT and consumption tax.
17. Bonded processing enterprises with export priority are, upon approval by the Customs office, permitted to set up bonded factories for processing trade. Imported facilities for the processing, assembly and production of export goods for foreign investors are allowed deferral in going through formalities for import taxation. Imported materials used for processing finished products for export enjoy exemption from tariffs and VAT.
18. The foreign business community in Shenzhen have long had access to national treatment. In the production of goods not restricted by State quota or permits, foreign invested entities are free to determine readjust the market share of domestic and overseas sales according to actual needs. They have the same standards in paying the utility bill with their domestic-funded counterparts. Foreign staffs working and living in Shenzhen enjoy equal service and are charged at the same rate with local citizens when it comes to renting or purchasing houses, seeking medical consultation or visiting scenic attractions. Back
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
REGISTERED AND PAID-UP CAPITAL
The Jonit Venture Law demands to invest in 25% that the foreign side invested the registered capital at least, does not generally have supreme upper limit to the investment which invests in the foreign side, unless relevant Chinese laws require Chinese side to have share of the minimum investment (such as the trade of limiting). The registered capital of Sino-foreign joint venture requires more than 1 million Hongkong dollars; The registered capital of overseas-funded enterprise can't be lower than 1 million Hongkong dollars, enterprises of bonded area can't be lower than 2 million Hongkong dollars.
Both sides can invest one's own fund in cash , equipment , industrial property or other forms . General, Chinese side puts up cash, land development , foreign side of right to use the land put up cash , build goods and materials , science and technology , equipment. All investment must obtain approval , Chinese of related departments , is it register accounting teachers Chinese report that accounting firm provided of quality to have.
ANNUAL RETURN
Any limited companies in Shenzhen should summit annual return to the relevant authorities. The annual cost is about USD500. If we fail to do so, we may be subject to a fine. Back
EMPLOYMENT
Employment is a privilage in China. China occupies one quarter of the world population, So China provides cheap labor, which can lower our cost. Back
DOCUMENTS REQUIRED
Handle the file that foreign capitals joint-venture , cooperation need offering
1, The copies of foreign businessman's investor's registration certificate and commercial card; 2, Two credibility certificate original papers of bank, showed the investor's credit state, needed to issue within 6 months, there is Chinese and English contrast ;
3, Foreign businessman's investors' resolution of board of directors;
4, The passport copy of the legal representative, 2 photos, or Hong Kong ID card , entering the pass accurately;
5, 2 place lease contract originals;
6, Investor's company and the director's material, blue form return
7 , President and directors appoint the book such as the anniversary of Hong Kong company. 8, Envision feasibility research reports of the Chinese company , the contracts of the rules , Chinese side and foreign side, such as exceeding a investor, the agreement that took during the investor, show the right , responsibility , ratio between investments of both sides, about discussing business affairs , solving the rule of the dispute ,etc..
9, Enterprises register the original paper of letter of authority entrust
Handle the foreign capitals joint-venture , cooperative procedure
PROCEDURES
Sign the agreement- >>Pay the deposit- >>Sign the file - >>Hand over the necessary materials- >>Sign the file - >>Written instructions or comments of foreign capitals office - >>Written instructions or comments of environmental protection ->>Enterprises compose yard in advance- >>Industrial and commercial business license- >>National tax , land tax- >>Enterprises organize the code card (IC card)- >>Public security bureau seal - >>Basic account number of the bank- >>Handle the registration card of the foreign currency- >>Handle the registration card of the customs- >>It finishes 20~30 workdays
OUR SERVICE
After finishing all formalities, you can get : The file of Foreign Economic Relations and Trade office of XX city (sets up ) / the other certificate of approval of Economic and Trade Commission / business license , copy / national tax , certificate reserved copy and duplicate of the land tax //National tax , land tax registration form /apply not scribing seal the registers / corporation by-law / environmental protection written instructions or comments of /organize code card of enterprise (IC card) /foreign currency registration card /have the basic bank account number / customs registration card / official seal , signet , chapter , the customs declaration chapter .
HOW TO BEGIN
Download and fill in the application form, fax or email to us. When we receive your request, we'll send you a confirmation letter for your final decision. At this time you pay 50% down payment, and we begin to process your application. Back
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