The State Council announced in its executive meeting held on October 25, 2013, that it is pushing forward the reform of the company registration regime.
In a press conference held on November 7, 2013, by the Information Office of the State Council, Zhang Mao, director of the State Administration for Industry and Commerce (“SAIC”), summarized the following reform policies:
- The minimum registered capital requirement for setting up a company will be lifted. The reform will annul the registered capital threshold of RMB 30,000 for limited liability companies, RMB 100,000 for single shareholder companies and RMB 5,000,000 for joint-stock companies.
- Initial disbursement ratio and deadline for full contribution will be canceled.
- Information on paid-in capital or any change to it no longer needs to be registered; investors will only have to register their subscribed capital.
- Investors will be able to make flexible decisions on their subscribed capital and freely decide the timeline and capital contribution method.
- The annual inspection will be replaced with an annual report. Companies will have to disclose their registration records, annual reports and company certificates through a company credit system, promoting public availability of the company’s information.
- Limitations on address that can be registered as the company’s domicile will be relaxed.
Zhang Mao pointed out that these reform policies will also apply to foreign-invested companies, following the “national treatment” principle.
These policies will be included in the upcoming amendments to the PRC Company Law, Sino-foreign joint venture laws and other foreign investment related laws and regulations. Until these amendments are made, investors must still follow the current company registration regime.