Shenzhen Initiates Commercial Registration Reform

Mar. 1 – The People’s Congress of Shenzhen Municipality passed the “Regulation on Commercial Registration in the Shenzhen Special Economic Zone (hereinafter referred to as the ‘Regulation’)” on October 30, 2012, which states that commercial registration authorities shall no longer collect commercial registration fees starting from March 1, 2013.

The Regulation defines “commercial subjects” for the first time, providing that the term refers to the legally-registered natural persons, legal persons and other economic organizations engaged in business activities for the purpose of profit-making.

Furthermore, the Regulation clarifies that the establishment, alteration and termination of all commercial subjects should be registered with the commercial registration authorities, and from March 1, 2013, the registration fees for such matters shall no longer be collected.

The Regulation also requires commercial subjects to apply with the commercial registration authorities for an updated business license within one year from March 1, 2013.

In response, Shenzhen’s Market Supervision Administration released a circular regarding the application of updated business licenses on February 18, 2013, which puts forward eight categories of commercial subjects that are required to apply for an updated business license. Detailed information can be found below.

Implementation Scope

The following commercial subjects registered in Shenzhen before March 1, 2013 shall apply for an updated version of their business license:

• Joint stock limited companies and their branch offices (including foreign-invested enterprises)
• Limited liability companies and their branch offices (including foreign-invested enterprises)
• Cooperative stock enterprises and their branch offices
• Non-corporate legal persons and their branch offices
• Partnership enterprises (including foreign-invested partnership enterprises) and their branch offices
• Foreign enterprises engaged in business operations within China
• Individual proprietorship enterprises and their branch offices
• Individually-owned businesses (including Hong Kong, Macau or Taiwan individually-owned businesses that have registered in Shenzhen)

Implementation Period

The above-mentioned commercial subjects shall apply for updated business licenses during March 1, 2013 to February 28, 2014.

Application Material

• Application form for updated business licenses
• Business license and copy thereof
• One copy of the second-generation identity card of the person handling the matter
• An authorization letter shall be submitted if an agent is entrusted

Application Procedure

• Submission of application materials
• Issuance of the updated business license

Where all the submitted materials are in compliance with statutory requirements, the commercial registration authority shall issue the updated business license on the spot.

Business License Types

After the initiation of the reform, there are now four types of business licenses in Shenzhen, specifically:

(1) Business Licenses for Legal Person Enterprises – Applicable to enterprise legal persons.

(2) Business Licenses for Non-legal Person Enterprises – Applicable to partnership enterprises (including foreign-invested partnership enterprises) and individual proprietorship enterprises.

(3) Business Licenses for Branch Offices – Applicable to the following:

• Branch office of a legal person enterprise
• Branch office of a non-corporate legal person
• Branch office of a partnership enterprise
• Branch office of an individual proprietorship enterprise
• Branch office of a foreign enterprise engaged in business operations within China

(4) Business License for Individually-owned Businesses – Applicable to individually-owned businesses.

---