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Investor's Guide -Legal Business Entities
There are three types of legal, foreign
business entities in Shanghai:
Which type is allowed or chosen depends on a number of factors, for example the size of the operation, the level
of local expertise in the industry, whether the company already has a JV
in another Chinese city, the type of business to be conducted, and how
long the organization has been in China.
The rules in Shanghai are basically the same as in the rest of China. Projects of investment greater than USD 30 million must gain the approval of the relevant body of the State Council in Beijing after review by the Shanghai municipal government. Projects involving USD 10 - 30 million can be approved at the municipal level, depending on the location. Projects located in Pudong or Waigaoqiao can be reviewed by the appropriate departments in these areas. Projects in the rest of Shanghai should submit plans to the Shanghai Municipal Foreign Investment Commission. Projects of USD 10 million or less can be approved at the district, county, or bureau level.
Two major government agencies are responsible for foreign trade and investment in Shanghai. The Shanghai Municipal Foreign Trade and
Economic Commission (SMERT) oversees foreign investment, trade policy, and the regulatory environment in Shanghai.
The Foreign Investment Commission (FIC) is specifically responsible in many ways for joint ventures and WOFEs as well as for projects with investment between USD 10 and 30 million. They will help foreign investors by introducing Shanghai's investment environment and policies, recommending proper partners, offering various consulting services on policies, laws and regulations, handling complaints, etc.
To get started, contact these critical
organizations to help determine the relevant government's policies
toward an individual project or industry. In addition, foreign chambers of commerce, and professional
consulting companies can assist foreign firms in navigating the maze of
bureaucratic entanglements associated with investing in China.
Click one of the links below for details of policies and
procedures:
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