Establishing a Representative Office
Before a foreign company is allowed to establish a RO in China the relevant authorities will have to approve the request and the registration of the office has to be completed.
Approval: Relevant authorities
The request for approval has to be made with different authorities depending on the type of company one wants to establish.
Some examples are:
- Company concerning trade, commerce and manufacturing -> Ministry of Foreign Trade and Economic Cooperation (MOFTEC)
- Company concerning finance or insurance -> People's Bank of China
- Company concerning maritime transportation -> Ministry of Communications
- Company concerning air transportation -> China Administration of Civil Aviation
- Company concerning post and telecommunication -> Ministry of Information
- Company concerning travel and tourism -> Tourist Bureau of the People's Republic of China
- Company concerning advertising -> State Administration for Industry and Commerce
For a company of another trade than the ones mentioned above, the application should be filed with the governmental authority in charge of that specific industry. It is important to remember that this request cannot be made by the foreign company itself. It will have to appoint a local sponsor who will then file the request on behalf of the foreign company.
Approval: Necessary documents
When submitting the request for approval to the relevant authorities certain documents have to be attached. These differ depending on who the approval authority is but they usually consist of the following:
- Application form for the establishment of a RO. This is a standard form issued by the approval authority which asks for basic information about the foreign company establishing the RO, as well as information about the RO itself
- - Application letter for the establishment of a RO. This letter should contain the following information:
- An introduction to the foreign company and its business activities in China
- The name, address, purpose, duration as well as business scope of the RO (It is very important that the business scope is filled in correctly because it will be stated in the Registration Certificate for the Representative Office. And a RO can only engage in business activities that are within the business scope as set forth in the Registration Certificate)
- The name of the chief representative
- A list of the documents being submitted
- Application form for the employees of a RO. This form should contain the basic information of the employees like their names, nationalities, contact details and positions in the RO
- The appointment letter for the chief representative. This letter must be printed on the letterhead paper of the company and has to be signed by an authorized representative of the company. It should clearly state the name of the person who will become chief representative of the RO
- Resumes (These have to be signed by the person in question), photocopies of the passports as well as passport size photos of all the representatives, including the chief representative
- Bank creditworthiness letter. This letter, printed on the letterhead paper of the bank, has to be issued by a foreign bank in the area where the foreign company is located and should be signed by authorized officials of the bank. It is needed to show that the applicant has financial and credit standing. The letter should contain the following information:
- The name of the foreign company
- The normal deposit amount of the average daily balance for a period of six months
- A short review of the creditworthiness of the foreign company
- A signed office lease agreement or a letter of intent of lease (It is important to remember that a landlord of an office or a building needs a special permission to rent commercial property to foreigners. So always make sure that he has that permission. You need an official letter from your landlord stating either that he has permission to rent commercial property to foreigners or that the building in which the property is located is itself certified by the local public security bureau as suitable for ROs registrations, a so-called grade A building)
- * Statutory documents of the parent company issued by authorities of the country of origin, e.g. a certificate of incorporation or a business license
When any of the above mentioned documents are in a language other than Chinese, a Chinese translation should be provided for. In some cases it might even be necessary to have the above mentioned documents notarized by a foreign notary and then legalized by the consulate of the People's Republic of China in that foreign country.