China's top legislature last week read for the second time the draft anti-monopoly law which requires foreign purchases of Chinese companies to be scrutinized to ensure there is no negative effect on the national security.
The draft of China's first anti-monopoly law was submitted to the 28th session of the Standing Committee of the National People's Congress for a second reading.
"Foreign mergers and acquisitions of domestic companies or foreign capital investing in domestic companies' operations in other forms should be examined according to relevant laws and regulations if the cases are related to national security," the draft reads.
According to official statistics, the number of foreign M&A cases only accounted for five percent of all forms of foreign direct investment in China annually before 2004. However, the proportion rapidly increased to 11 percent in 2004 and nearly 20 percent in 2005.
Foreign companies have even begun to acquire major state-owned enterprises or companies with famous brands in recent years, arousing concerns about China's economic security.
Zhang Yansheng, director of the International Economic Research Institute under the National Development and Reform Commission, said it is crucial to require foreign purchases of domestic companies to go through stringent state security checks as well as a thorough anti-monopoly monitoring.
Thursday, July 5, 2007
Wednesday, July 4, 2007
China inaugurates free-trade harbor area in Dalian
China inaugurated a harbor area with preferential tax rates on Thursday in the northeastern city of Dalian, a major step towards forming a free trade zone between China, Japan and the Republic of Korea (ROK).
The Dayaowan Bonded Harbor Area, located at the Dagushan Peninsula in the northeastern part of Dalian, enjoys preferential taxation and foreign exchange policies, said Zhang Shikun, director of the Dalian Bonded Area Administrative Committee.
"It will remove tariffs for foreign cargo and offer tax rebates for domestic cargo. It will also exempt businesses from value added taxes and consumption taxes if they trade with each other," Zhang said.
Analysts predict the efficiency of logistics will be raised by 20 percent after the port is put into operation.
The first phase of the area covers 3.06 square kilometers and includes warehouses, cold storage facilities, a container terminal and processing and logistics services.
About 200 million yuan (25 million U.S dollars) has been spent on the construction of the area since August 31 last year, when the State Council approved its establishment.
The second phase is expected to be finished by the end of next year, expanding the area to 6.88 square km.
The Dalian port is the seventh largest in China and handled 200million tons of cargo and 30 million containers (TEUs) last year.
The Dayaowan Bonded Harbor Area is the second of its kind in China, following the operation of the Shanghai-based Yangshan Bonded Harbor Area in December 2005. The State Council has also approved a third such area, the Dongjiang Bonded Harbor Area whichis under construction in north China's Tianjin Municipality.
Analysts say the Dayaowan area is expected to increase China's share in the northeast Asian shipping industry, and is also considered a major step towards forming a free trade zone between China, Japan and ROK, which political leaders and business circles of the three countries have repeatedly called for.
Dalian has advantages for a free trade zone in terms of its location and its close economic and cultural links with neighboring countries, said Wang Jun, associate professor on logistics studies with the Dalian Maritime University.
Dalian is one of the most successful Chinese cities in attracting Japanese and ROK businesses -- half of the city's overseas-funded businesses come from Japan and the ROK, more than 5,000 in number, and 40 percent of the city's foreign trade comes from the two countries, local government statistics show.
"The internationalization of Dalian has been largely due to Japan and the ROK, and Dalian has every advantage for building a free trade zone in northeast Asia," said Xia Deren, mayor of Dalian.
"We expect to develop the area of about 50 square km surrounding the Dagushan Peninsula into a free trade zone on the basis of the Dayaowan Bonded Harbor Area," he said.
"But, of course, it has to depend on the country's overall economic layout," he added.
The Dayaowan Bonded Harbor Area, located at the Dagushan Peninsula in the northeastern part of Dalian, enjoys preferential taxation and foreign exchange policies, said Zhang Shikun, director of the Dalian Bonded Area Administrative Committee.
"It will remove tariffs for foreign cargo and offer tax rebates for domestic cargo. It will also exempt businesses from value added taxes and consumption taxes if they trade with each other," Zhang said.
Analysts predict the efficiency of logistics will be raised by 20 percent after the port is put into operation.
The first phase of the area covers 3.06 square kilometers and includes warehouses, cold storage facilities, a container terminal and processing and logistics services.
About 200 million yuan (25 million U.S dollars) has been spent on the construction of the area since August 31 last year, when the State Council approved its establishment.
The second phase is expected to be finished by the end of next year, expanding the area to 6.88 square km.
The Dalian port is the seventh largest in China and handled 200million tons of cargo and 30 million containers (TEUs) last year.
The Dayaowan Bonded Harbor Area is the second of its kind in China, following the operation of the Shanghai-based Yangshan Bonded Harbor Area in December 2005. The State Council has also approved a third such area, the Dongjiang Bonded Harbor Area whichis under construction in north China's Tianjin Municipality.
Analysts say the Dayaowan area is expected to increase China's share in the northeast Asian shipping industry, and is also considered a major step towards forming a free trade zone between China, Japan and ROK, which political leaders and business circles of the three countries have repeatedly called for.
Dalian has advantages for a free trade zone in terms of its location and its close economic and cultural links with neighboring countries, said Wang Jun, associate professor on logistics studies with the Dalian Maritime University.
Dalian is one of the most successful Chinese cities in attracting Japanese and ROK businesses -- half of the city's overseas-funded businesses come from Japan and the ROK, more than 5,000 in number, and 40 percent of the city's foreign trade comes from the two countries, local government statistics show.
"The internationalization of Dalian has been largely due to Japan and the ROK, and Dalian has every advantage for building a free trade zone in northeast Asia," said Xia Deren, mayor of Dalian.
"We expect to develop the area of about 50 square km surrounding the Dagushan Peninsula into a free trade zone on the basis of the Dayaowan Bonded Harbor Area," he said.
"But, of course, it has to depend on the country's overall economic layout," he added.
Tuesday, July 3, 2007
The Ministry of Commerce Issued “Administrative Measures for Archival Filing of Commercial Franchise” and “Administrative Measures for the Information
On February 6, 2007, the State Council issued Order No. 458 to proclaim Administrative Provisions on Commercial Franchise. In order to implement the Provisions, the Ministry of Commerce passed on April 30, 2007 the Administrative Measures for Archival Filing of Commercial Franchise and the Administrative Measures for the Information Disclosure of Commercial Franchise, which came into force on May 1, 2007.
1. Archive management
1) Filing authority
The Ministry of Commerce and administrative department of commerce at provincial level are filing authority of commercial franchise. Those who are engaged in commercial franchise within a province, autonomous region or municipal city directly governed by the State Council shall put their business on file with the administrative department of commerce at provincial level where the franchiser is located. Those who are engaged in commercial franchise inter-province, inter-region or inter municipal city shall put their business on file with the Ministry of Commerce. The filing of commercial franchise all over the country is connected by internet. Franchisors, complied with Administrative Provisions, shall file on the website of the government.
2) Filing materials
Franchisor shall submit the following materials to the filing authority:
(1) Basic information of the commercial franchise, distribution of shops of all franchisee in China, marketing proposal of franchisor;
(2) Copy of business license or certificate of other entities;
(3) Copy of certificate of trademark right, patent right or other operative resources relevant to franchise;
(4) Certifying document issued by administrative department of commerce at city level conformed with Article 7(2) of the Provisions; Business certificate of the direct sales stores if the store is within the territory of China.
(5) Catalogue of the franchise hand book.
(6) Other necessary documents
3) Filing Procedure
The franchisor shall, within 15 days after the franchisor first comes into contract with the franchisee within the territory of the PRC, file its contract with the filing authority.The filing authority shall, within 10 days from the date of receiving the required documents and materials from the franchisor, put the contract on file and have it published on the website of the Ministry of Commerce. Should the submitted documents or materials be inadequate, the filing authority may ask for supplementary submission from the franchisor within 7days. The filing authority shall within 10 days after supplementary submission put the contract on file.The general public may find out the name of the enterprise, the registered trademark, the enterprise’s logo, patent, know-how and other operative resources used in the commercial franchise services and also other commercial franchise information on the website of the Ministry of Commerce.
2. Management of the Information Disclosure
1) Time of the Disclosure
The franchisor shall at least 30 days before coming into the commercial franchise contract, disclose to the franchisee the information related to franchise in written form and provide contract of commercial franchise.
2) Content to be Disclosed
The information to be disclosed by the franchisor shall include the following:
(1) The basic information of the franchisor and its service, e.g. the name, address, contact means, legal representative, general manager, the amount of registered capital, business scope of the franchisor and the present number, address and phone number of direct operative shops of the franchisor.
(2) The basic information of the operative resources. The franchisor shall in written form explain to the franchisee the available registered trademarks, the enterprise’s logo, patent, know-how, operation pattern and other operative resources.
(3) The basic information of the franchise fees, including: the type, sum, standard and payment means of the fees charged by the franchisor and on third party’s behalf; collection of guarantee, condition, time and method for return of the guarantee etc.
(4) The price and conditions for supply of the products, services or equipments to the franchisee, e.g. whether or not the franchisee must purchase from the franchisor or its related company the products, services or equipments and the relevant price and conditions.
(5) The continue provision of service by the franchisor, e.g. the detailed content, means of provision and implementing plans, including the place, means and duration of the business training.
(6) The means and content of direction to and supervision over the business operated by the franchisee.
(7) Related information of the franchisee with the territory of the PRC, e.g. the actual or anticipated average sales amount, cost, gross and net profit of the franchisee.
(8) Recent 2 years’ financial accounting and auditing report abstracts produced by accounting or auditing agencies.
3) Other Items
Before disclosing information to the franchisee, the franchisor has the right to request the franchisee to sign a confidentiality contract. After the disclosure, the franchisee shall produce to the franchisor a signed copy of receipt as to the known information in duplicate, one for the franchisee and the other for the franchisor.Should the franchisor conceal any information that should be disclosed or disclose any wrong information, the franchisee may dissolve the commercial franchise contract.
1. Archive management
1) Filing authority
The Ministry of Commerce and administrative department of commerce at provincial level are filing authority of commercial franchise. Those who are engaged in commercial franchise within a province, autonomous region or municipal city directly governed by the State Council shall put their business on file with the administrative department of commerce at provincial level where the franchiser is located. Those who are engaged in commercial franchise inter-province, inter-region or inter municipal city shall put their business on file with the Ministry of Commerce. The filing of commercial franchise all over the country is connected by internet. Franchisors, complied with Administrative Provisions, shall file on the website of the government.
2) Filing materials
Franchisor shall submit the following materials to the filing authority:
(1) Basic information of the commercial franchise, distribution of shops of all franchisee in China, marketing proposal of franchisor;
(2) Copy of business license or certificate of other entities;
(3) Copy of certificate of trademark right, patent right or other operative resources relevant to franchise;
(4) Certifying document issued by administrative department of commerce at city level conformed with Article 7(2) of the Provisions; Business certificate of the direct sales stores if the store is within the territory of China.
(5) Catalogue of the franchise hand book.
(6) Other necessary documents
3) Filing Procedure
The franchisor shall, within 15 days after the franchisor first comes into contract with the franchisee within the territory of the PRC, file its contract with the filing authority.The filing authority shall, within 10 days from the date of receiving the required documents and materials from the franchisor, put the contract on file and have it published on the website of the Ministry of Commerce. Should the submitted documents or materials be inadequate, the filing authority may ask for supplementary submission from the franchisor within 7days. The filing authority shall within 10 days after supplementary submission put the contract on file.The general public may find out the name of the enterprise, the registered trademark, the enterprise’s logo, patent, know-how and other operative resources used in the commercial franchise services and also other commercial franchise information on the website of the Ministry of Commerce.
2. Management of the Information Disclosure
1) Time of the Disclosure
The franchisor shall at least 30 days before coming into the commercial franchise contract, disclose to the franchisee the information related to franchise in written form and provide contract of commercial franchise.
2) Content to be Disclosed
The information to be disclosed by the franchisor shall include the following:
(1) The basic information of the franchisor and its service, e.g. the name, address, contact means, legal representative, general manager, the amount of registered capital, business scope of the franchisor and the present number, address and phone number of direct operative shops of the franchisor.
(2) The basic information of the operative resources. The franchisor shall in written form explain to the franchisee the available registered trademarks, the enterprise’s logo, patent, know-how, operation pattern and other operative resources.
(3) The basic information of the franchise fees, including: the type, sum, standard and payment means of the fees charged by the franchisor and on third party’s behalf; collection of guarantee, condition, time and method for return of the guarantee etc.
(4) The price and conditions for supply of the products, services or equipments to the franchisee, e.g. whether or not the franchisee must purchase from the franchisor or its related company the products, services or equipments and the relevant price and conditions.
(5) The continue provision of service by the franchisor, e.g. the detailed content, means of provision and implementing plans, including the place, means and duration of the business training.
(6) The means and content of direction to and supervision over the business operated by the franchisee.
(7) Related information of the franchisee with the territory of the PRC, e.g. the actual or anticipated average sales amount, cost, gross and net profit of the franchisee.
(8) Recent 2 years’ financial accounting and auditing report abstracts produced by accounting or auditing agencies.
3) Other Items
Before disclosing information to the franchisee, the franchisor has the right to request the franchisee to sign a confidentiality contract. After the disclosure, the franchisee shall produce to the franchisor a signed copy of receipt as to the known information in duplicate, one for the franchisee and the other for the franchisor.Should the franchisor conceal any information that should be disclosed or disclose any wrong information, the franchisee may dissolve the commercial franchise contract.
Sunday, June 24, 2007
China to Further Regulate Commercial Franchise
The Regulation on Administration of Commercial Franchise ("Regulation") was issued by the State Council (Decree No. 485) on February 6, 2007 and will come into force as of May 1, 2007. The Regulation applies to the franchisors that have been engaging in franchising activities before and after the promulgation of the Regulation, including five chapters and thirty four articles.
Franchisors and commercial franchise
According to the Regulation, "franchisors" refer to the enterprise which is in possession of a registered trademark, enterprise logo, patent, know-how and any other business resource. The "Commercial franchise" as mentioned in the regulation means business activities whereby the franchisor allows the franchisee the use of the operational resources through contracts, and the franchisee undertakes business under the unified business format in accordance with the provisions of stipulated in the contracts and pays franchise fees to the franchisor.
The basic requirements for franchising activities
1. Only the franchisors prescribed in the Regulation may carry out franchising activities, no entities or individuals other than enterprises may engage in franchising activities as franchisors;
2. A franchisor engaged in franchising activities shall own a well-developed business format and has the capabilities to continuously provide operational guidance, technical support, business training, and other services to the franchisee;
3. A franchisor engaged in franchising activities shall own at least two directly operated outlets, and shall be in operation for more than one year.
4. Within 15 days after the execution of the initial franchise contract, a franchisor shall file with the commercial administration authority and put on records in accordance with the Regulation. For the franchisors who have been engaging in franchising activities before the promulgation of the Regulation, they shall put on records within one year starting from the promulgation date of this Regulation..
Commercial franchise contract
1. A franchise contract shall be signed by franchisor and franchisee in written form and meets the requirements of the Regulation;
2. The franchisor and the franchisee shall set forth in the franchise contract that the franchisee is entitled to unilaterally terminate the franchise contract within a certain period after the contract is signed;
3. The term of the franchise as stipulated in the franchise contract shall not be less than three years, unless otherwise agreed to by the franchisee.
Information disclosure
The Regulation prescribes that the franchisor shall establish and implement a complete information disclosure system. The franchisor shall provide the franchisee with the information in written form and the text of the franchise contract at least 30 days before the franchise contract is signed.
The information shall be disclosed by the franchisor include the basic information of the franchisor and its legal representative, commercial reputation record, the business resource owned by the franchisor, the capacity of the franchisor to provide service to the franchisee, specific measures in respect of the guidance and supervision over the operational activities of the franchisee, the amount and payment method of the franchise fees and investment budget for the franchised outlets.
Franchisors and commercial franchise
According to the Regulation, "franchisors" refer to the enterprise which is in possession of a registered trademark, enterprise logo, patent, know-how and any other business resource. The "Commercial franchise" as mentioned in the regulation means business activities whereby the franchisor allows the franchisee the use of the operational resources through contracts, and the franchisee undertakes business under the unified business format in accordance with the provisions of stipulated in the contracts and pays franchise fees to the franchisor.
The basic requirements for franchising activities
1. Only the franchisors prescribed in the Regulation may carry out franchising activities, no entities or individuals other than enterprises may engage in franchising activities as franchisors;
2. A franchisor engaged in franchising activities shall own a well-developed business format and has the capabilities to continuously provide operational guidance, technical support, business training, and other services to the franchisee;
3. A franchisor engaged in franchising activities shall own at least two directly operated outlets, and shall be in operation for more than one year.
4. Within 15 days after the execution of the initial franchise contract, a franchisor shall file with the commercial administration authority and put on records in accordance with the Regulation. For the franchisors who have been engaging in franchising activities before the promulgation of the Regulation, they shall put on records within one year starting from the promulgation date of this Regulation..
Commercial franchise contract
1. A franchise contract shall be signed by franchisor and franchisee in written form and meets the requirements of the Regulation;
2. The franchisor and the franchisee shall set forth in the franchise contract that the franchisee is entitled to unilaterally terminate the franchise contract within a certain period after the contract is signed;
3. The term of the franchise as stipulated in the franchise contract shall not be less than three years, unless otherwise agreed to by the franchisee.
Information disclosure
The Regulation prescribes that the franchisor shall establish and implement a complete information disclosure system. The franchisor shall provide the franchisee with the information in written form and the text of the franchise contract at least 30 days before the franchise contract is signed.
The information shall be disclosed by the franchisor include the basic information of the franchisor and its legal representative, commercial reputation record, the business resource owned by the franchisor, the capacity of the franchisor to provide service to the franchisee, specific measures in respect of the guidance and supervision over the operational activities of the franchisee, the amount and payment method of the franchise fees and investment budget for the franchised outlets.
Friday, June 22, 2007
Enterprise Income Tax Law Passed, Same Tax Rate Applied to Domestic and Foreign-invested Enterprise
On March 16, 2007, the Enterprise Income Tax Law was passed by the National People’s Congress. The Law covers 8 chapters and totally 60 articles, including General Provisions, Taxable Amount of Income, Amount of Payable Taxes, Preferential Tax Treatments, Withholding by Sources, Special Adjustments to Tax Payments, Administration of Tax Collection and Supplementary Provisions and will go into effect on January 1st, 2008.
The Enterprise Income Tax Law provides that the payers of the enterprise income tax are classified into resident and non-resident enterprises. "Resident enterprise" as mentioned in this Law refers to an enterprise which is established inside China, or which is established under the law of a foreign country (region) but whose actual institution of management is inside China, and "non-resident enterprise" refers to an enterprise established under the law of a foreign country (region), whose actual institution of management is not inside China but which has institutions or establishments inside China; or which has not any institution or establishment inside China but which has incomes sourced in China. The enterprise income tax rate is 25%, and the tax rate of 20% is applied to those “non-resident enterprises” without the institution or establishment inside China, or those have not any institution or establishment inside China but which has incomes sourced in China.
The government gives preferential income tax treatment to those state-supported and encouraged industries and projects. Furthermore, in terms of those qualified enterprises with insignificant profit, the 20% tax rate shall be applied. And the income tax rate of 15% will be levied against those hi-tech enterprises for key cultivation
The Enterprise Income Tax Law provides that the payers of the enterprise income tax are classified into resident and non-resident enterprises. "Resident enterprise" as mentioned in this Law refers to an enterprise which is established inside China, or which is established under the law of a foreign country (region) but whose actual institution of management is inside China, and "non-resident enterprise" refers to an enterprise established under the law of a foreign country (region), whose actual institution of management is not inside China but which has institutions or establishments inside China; or which has not any institution or establishment inside China but which has incomes sourced in China. The enterprise income tax rate is 25%, and the tax rate of 20% is applied to those “non-resident enterprises” without the institution or establishment inside China, or those have not any institution or establishment inside China but which has incomes sourced in China.
The government gives preferential income tax treatment to those state-supported and encouraged industries and projects. Furthermore, in terms of those qualified enterprises with insignificant profit, the 20% tax rate shall be applied. And the income tax rate of 15% will be levied against those hi-tech enterprises for key cultivation
National People’s Congress Passed Property Law
On March 16, 2007, the National People’s Congress passed Property Law, which will come into effect on October, 1st, 2007. Property Law constitutes five parts (19 chapters 247 articles), including General Principles, Proprietorship, Usufructaury Rights, Security Interest and Possession. The relatively more important content of the Property Law covers the following issues: Firstly, it expressly gives equal protection on state-owned, collective and private property. Secondly, it clearly sets forth the scope of state-owned property, the exercise of state ownership and strengthened protection on state-owned property. Thirdly, it provides that the individual enjoys the ownership of its real properties and chattels such as legitimate income, house, consumer goods, manufacture tools and raw materials, and it stipulates provisions regarding those issues concerned by the public, such as the owner’s portioned ownership of the building areas. Fourthly, it explicitly sets forth the issue of compensation for expropriation, e.g. it provides the reason and content of expropriation. Fifthly, it provides the possession, and specifies the protection on possession and infringement liability of adverse possessor so as to keep the social order and holder’s legitimate interests.
Thursday, June 21, 2007
PROCEDURE FOR FOREIGN INVESTORS TO ENTER CHINA
Visa:
Foreign investors who wish to visit China for business may approach Chinese partners directly with purpose and time of the visit The Chinese partner can apply for visa notification on behalf of the foreign investors at a local foreign affairs organization if the visit is receptacle. Once foreign investors have received the visa notification from Chinese domestic authorized organization, the foreign investors may apply for entry visa to China at a local Chinese embassy or consulate.
Apply for Employment License, Expert Certificate, Residence Certificate:
A foreign invested enterprise, which is intending to employ expatriates, may apply for "the employment license for the expatriates in the People's Republic of China" (hereinafter referred to as employment license) at the Shanghai Labor & Social insurance Bureau with the following documents: company business license, certificate of approval for setting up enterprise, application report, and the expatriates' personal documents. With the employment license the enterprise may apply for profession visa notification at Shanghai Municipal Foreign Economic Relations and Trade Commission (SMERT), which is authorized by the Ministry of Foreign Affairs of the People's Republic of China. The expatriates can apply for profession visa to entry into China at a local Chinese Embassy with the fax copy of profession visa notification and the employment license. After entering China, the expatriates can apply for employment certificate at Shanghai Labor & Social Insurance Bureau with the following documents: profession visa, employment license, employment contract, health certificate and photos of the expatriates within 15 days. With the employment certificate, the expatriates can apply for residence certificate at the Division of Exit and Entry Administration of Shanghai Public Security Bureau.
If a foreign-invested company will hire employees from Hong Kong, Macao and Taiwan, the company shall submit its application to the Office of Administrating the employment of the personnel from Hong Kong, Macao and Taiwan set up in Shanghai Labor and Social Insurance Bureau. The Employment License for the Personnel from Hong Kong, Macao and Taiwan will be issued after the application has been examined and approved by above-mentioned Bureau and the personnel from Hong Kong, Macao and Taiwan shall apply for the residence certificate with the Division of Exit and Entry Administration set up in Shanghai Public Security Bureau on the strength of the Employment License.
Shanghai agents, which provides service to foreign enterprises for establishing representative offices in Shanghai, can go to SMERT to apply for profession visa notification for the chief representative and representatives on behalf of the foreign enterprise. After receiving the profession visa notification, the chief representative and representatives may apply for profession visa at a local Chinese embassy or consulate for entering into China. Upon entering China, they can apply for work permit certificate at Shanghai Commercial and Industrial Administration Bureau. The representatives can then go to Shanghai Labor & Social Insurance Bureau to apply for employment certificate with the following document: profession visa, work permit certificate, health condition certificate, photos. Then they can go to Shanghai Public Security Bureau to apply for residence certificate.
Foreign investors who wish to visit China for business may approach Chinese partners directly with purpose and time of the visit The Chinese partner can apply for visa notification on behalf of the foreign investors at a local foreign affairs organization if the visit is receptacle. Once foreign investors have received the visa notification from Chinese domestic authorized organization, the foreign investors may apply for entry visa to China at a local Chinese embassy or consulate.
Apply for Employment License, Expert Certificate, Residence Certificate:
A foreign invested enterprise, which is intending to employ expatriates, may apply for "the employment license for the expatriates in the People's Republic of China" (hereinafter referred to as employment license) at the Shanghai Labor & Social insurance Bureau with the following documents: company business license, certificate of approval for setting up enterprise, application report, and the expatriates' personal documents. With the employment license the enterprise may apply for profession visa notification at Shanghai Municipal Foreign Economic Relations and Trade Commission (SMERT), which is authorized by the Ministry of Foreign Affairs of the People's Republic of China. The expatriates can apply for profession visa to entry into China at a local Chinese Embassy with the fax copy of profession visa notification and the employment license. After entering China, the expatriates can apply for employment certificate at Shanghai Labor & Social Insurance Bureau with the following documents: profession visa, employment license, employment contract, health certificate and photos of the expatriates within 15 days. With the employment certificate, the expatriates can apply for residence certificate at the Division of Exit and Entry Administration of Shanghai Public Security Bureau.
If a foreign-invested company will hire employees from Hong Kong, Macao and Taiwan, the company shall submit its application to the Office of Administrating the employment of the personnel from Hong Kong, Macao and Taiwan set up in Shanghai Labor and Social Insurance Bureau. The Employment License for the Personnel from Hong Kong, Macao and Taiwan will be issued after the application has been examined and approved by above-mentioned Bureau and the personnel from Hong Kong, Macao and Taiwan shall apply for the residence certificate with the Division of Exit and Entry Administration set up in Shanghai Public Security Bureau on the strength of the Employment License.
Shanghai agents, which provides service to foreign enterprises for establishing representative offices in Shanghai, can go to SMERT to apply for profession visa notification for the chief representative and representatives on behalf of the foreign enterprise. After receiving the profession visa notification, the chief representative and representatives may apply for profession visa at a local Chinese embassy or consulate for entering into China. Upon entering China, they can apply for work permit certificate at Shanghai Commercial and Industrial Administration Bureau. The representatives can then go to Shanghai Labor & Social Insurance Bureau to apply for employment certificate with the following document: profession visa, work permit certificate, health condition certificate, photos. Then they can go to Shanghai Public Security Bureau to apply for residence certificate.
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