JV Enterprise Registration
Chinese–Foreign Joint Venture Company, sometimes referred to as Chinese-foreign cooperative enterprise, it is established by foreigners (or overseas company) and China company in accordance with Enterprise Laws of Chinese-Foreign Joint Ventures and Enterprise Laws of Chinese-Foreign Cooperative Joint Ventures. Generally the proportion of foreign investor should no less than 25%, China investor should be a company. Considering the characteristics of this company, it is more appropriate for the foreign investor who has suitable China partners, which is good to capitalize mutual strengths while helping to develop the business and market in China.
Comparing to WOFE, its advantage to foreign investors is convenient to capture China market and even enter into some limited areas/ industries through cooperate with China partner, such as, education, Accounting Firm, Human Resources agency (HR agent).
But JV is fading out because of the practical difficulties in :picking the proper China partners, management, technology issues, profit shares and etc.
Preferential policy in PuDong New Area in Shanghai: According to the latest preferential policy in Pudong, the China partner could be natural individual if you setup your enterprise there, please feel free to contact us if you need more information about it.
Types of JV’s
There are two types of Joint Venture (JV) :
Equity Joint Ventures
Cooperative Joint Venture
Cooperative Joint Venture Recommendation
Since Cooperative Joint Ventures offer more flexibility, we now mainly assist register the Cooperative JV. They can be organized either as a limited liability company or as a non-legal person, in which the partners are subject to unlimited liability and thus entirely liable for any losses the joint venture may incur. Most Cooperative Joint Ventures are established as limited liability companies.
Unlike Equity Joint Ventures, Cooperative Joint Ventures allow for profits to be allocated according to the partners’ decision.
The legal system in China and the business climate are changing in favor of WFOE and the restructuring of joint ventures. Joint ventures can be restructured into WFOEs. A minimum of 25% of the capital must be contributed by the foreign partner(s). There is no minimum investment for the Chinese partner(s).