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Yiwu FIPE formation

Update Date:2020-2-6 15:58:04     Views:1889

Yiwu FIPE formation
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The Foreign Invested Partnership Enterprise (FIPE) is an unlimited liability business entity without minimum requirements on registered capital. A partnership in the People's Republic of China is a business entity governed by the Partnership Enterprise Law passed by order of the President of the People's Republic of China to authorize and govern partnership enterprises. A partnership is a type of business entity in which partners share with each other the profits or losses of the business undertaking in which all have invested.

Yiwu FIPE formation is also called Yiwu FIPE setup, Yiwu FIPE Registration, Yiwu FIPE incorporation and Yiwu FIPE establishment.

Yiwu FIPE formation -Investors of Partnership Enterprise
The Minimum number of partners should be 2, there are no requirements on the nationality of a Partner, thus it can be all foreign investors to form a FIPE or Foreign and Chinese partners mixed FIPE.

Yiwu FIPE formation -Different types of FIPE in Yiwu
1. General partnership Enterprise (GPE): A general partnership enterprise may be formed by general partners who bear unlimited joint and several liabilities for the debts of the partnership. The general partners share unlimited liabilities for the debt of the partnership.

2. Limited partnership enterprise (LPE): A limited partnership enterprise is formed by a combination of general partners and limited partners where the limited partners bear the liabilities for the partnership's debts to the extent of their capital contributions.

3. Special General Partnership enterprise (SGP): A special general partnership enterprise resembles a general partnership except that it must be a professional service institution offering services requiring professional knowledge and special skills. The structure shields co-partners from liabilities due to the willful misconduct or gross negligence of one partner or a group of partners. It is very similar to limited liability partnership in Europe and America.


Yiwu FIPE formation -Advantages of FIPE
The advantages of establishing a FIPE , compared with other types of enterprises, include, but not limited to:
1. No requirements on minimum registered capital;
2. Less procedures comparing with Wholly Foreign Owned Enterprise or Joint Venture
3. Capability of converting RMB profits to US dollars for remittance to its parent company outside of China;
4. Foreign Enterprise or Individual is allowed to establish a Partnership Enterprise with Chinese individual (While Chinese individual is not allowed to have Joint Venture Company with foreign investor)e adopted in the partnership agreement (While for LLC, profit distributions are according the portage 
5. The profit distribution of a FIPE could follow an informal negotiated agreement or abide by schemof investment of shareholders)

Yiwu FIPE formation -Capital contribution of FIPE
A partner may contribute capital to the partnership to garner a share of the partnership's profits or losses. A capital contribution may include money, intellectual property right, land use right or other properties, or labor services at a valuation determined by agreement among the partners. If the partnership is a limited partnership, then the limited partners may not make capital contributions with labor services.

Yiwu FIPE formation -general tax information
No corporate income tax required if partners are individuals. The individual partners shall pay their respective share of the partnership income. Corporate income tax applies if partners are companies.

Yiwu FIPE formation -profit repatriation
China Government allows Foreign Invested Partner Enterprises remit their profits out of the country and such remittances do not require the prior approval of the State Administration of Foreign Exchange (SAFE). Dividends cannot be distributed and repatriated to oversea if the losses of previous years have not been covered while dividends not distributed in previous years may be distributed together with those of the current year. Repatriating the Registered Capital to home countries is forbidden during the term of business operation.

Yiwu FIPE formation -terms and terminations
In China, terms of  30 years are typical for a FIPE. It is also possible to obtain extensions of the FIPE's duration.

Contact Us
If you have further enquiries, don’t hesitate to contact ATAHK anytime, anywhere by simply visiting ATAHK’s website , or calling Hong Kong hotline at 852-27826888 or China hotline at 86-579-85206707, or emailing to
Yiwu address: R.1906,Block A,FuTian Building,North ChouZhou Road, YiWu,ZheJiang,China


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