China’s ‘One Window, One Form’ policy for business registration in full swing

On 28 February 2018, the Ministry of Commerce (MOFCOM) and State Administration of Industry and Commerce (SAIC) jointly announced the circular (letter of notice) on the implementation of  ‘One Window, One Form’ Business Registration Filing for Foreign Invested Entities. The circular follows from the 19th People’s Congress plan to further optimise foreign direct investment environment, the introduction of a record-filing administration for Foreign Investment Entities (FIE) 2016 and last year’s nationwide adoption of five business certificates into one policy.

As background, the record filing administration was introduced in September 2016 for FIEs, altering the previous approval system for establishment, amendment, equity transfers and other relevant matter related to commerce.  Additionally, from December 2017, businesses were required to carry out transfers on an all-in-one online system. The system integrated the five requisite certificates — business license, tax registration certificate, organization code certificate, social security registration and statistics registration certificate — into one license with a unified social credit code.

With the implementation of the circular nationwide from 30 June 2018, business registration filing of foreign-invested entities shall be further streamlined. The new system will comprehensively collect information through one form submitted via one singular window rather than the current system of submitting several documents to various government bodies. As a result, the reform reduces administrative processing time, strengthens data exchange among government departments and reduces risks of non-compliance. Specifically, the circular refers to the term increase exchange of data to reduce the work of corporations.

The circular provisions the following implementation schedule:

Phase 1: Preparation, March – June 2018
Under the execution plan jointly developed by MOFCOM and SAIC, local and provincial commerce and data standards established within the 5 to 1 policy, industry and commerce departments shall strengthen IT systems and networks to ensure smooth data transmission.

Phase 2: Nationwide Implementation, end of June 2018
One Window, One Form implemented nationwide.

Phase 3: Evaluation, July – December 2018
The Ministry of Commerce and the State Administration for Industry and Commerce shall jointly supervise the reforms and continuously improve the system in line with real-time implementation.

Overall, the circular is a positive encouragement for foreign investors looking to expand into the Chinese market. With a broader reform agenda, the Chinese government paves the way for a simpler, more streamlined business environment as well as the updating of administrative procedures from the previous paper-based structure into modern online administrative systems.

Horizons is a corporate advisory with a highly specialised focus on cross-border business transactions and their related aspects. Our practice is devoted to assisting companies and investors in ensuring local, regional and global compliance across the whole of their business activities—no matter which country their interests lie.

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