Salome Hernandez is currently living in Shanghai and hopes to be able to answer some of the questions the members of the Women’s Business Center might have on doing business in China or business with China.
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How does one set up a joint venture?   There are many persons interested in a China connection either purchasing goods or establishing an enterprise in China.  The steps needed to open a business are clear and well documented.   Each proposal is analyzed and approved on a project-by-project basis before it is registered.  Rules for the establishment of Chinese-foreign equity joint ventures and Chinese-foreign contractual joint ventures require:

A proposal must first be submitted and approved in writing; followed by a feasibility report to the planning department or technological renovation administration.  Approval is needed before investors can sign legal documents, such as the contract and articles of corporation of the enterprise.  Once signed, these documents are submitted to the examination and ratification department, for issuance of the Approval Certificate for Enterprises with Foreign Investment after approval by the Ministry of Foreign Trade and Economic Cooperation.  Investors can proceed with the registration formalities by presenting the Approval Certificate.

Investments of less than US $30 million in areas encouraged by the state can be examined and approved by provinces, municipalities, autonomous regions and cities listed as independent units in state plans.  Many of these political entities have established foreign investment service centers, which offer foreign investors with a one-stop service, ranging from legal consultation to procurement of project approval.  There are also many experts ready to provide consulting services.  Larger investments need the approval of the State Development Planning Commission or the State Economic and Trade Commission, while the contract and articles of corporation shall be examined and approved by the Ministry of Foreign Trade and Economic Cooperation.  

Initially investments required joint venture by a majority Chinese investment.  That has changed, and many international companies have chosen to be sole owners.  Most of these endeavors are million or multi-million dollar affairs.  While China  has attracted many companies to establish themselves here already, most small and medium enterprises would probably depend on existing companies.  However, there are also many investment opportunities. 

The many laws also propose to guarantee the independent operation rights of foreign-funded enterprises and to protect the legitimate rights and interest of both domestic and overseas investors.  (There are many website with information on the rules.)

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