China FIPE Formation Service
Hotline: 86-755-82148419, Email: susiehu@citilinkia.com, Wechat: 13823131503
The Foreign Invested Partnership Enterprise (FIPE) is a 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.
Different types of Foreign Invested Partnership Enterprise (FIPE)
Following are different types of FIPE. Commonly,
1. General partnership Enterprise (GPE): A general partnership enterprise may be formed by general partners who bear unlimited joint and several liability 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.
Advantages of Foreign Invested Partnership Enterprise (FIPE)
The advantages of establishing a PE, compared with other types of enterprises, include, but not limited to:
1. No corporate income tax for partnership enterprise;
2. No requirements on minium registered capital;
3. Less procedures comparing with Wholly Foreign Owned Enterprise or Joint Venture;
4. Capability of converting RMB profits to US dollars for remittance to its parent company outside of China;
5. Foreign Enterprise or Individual is allowed to establish a Partnership Enterprise with Chinese individual (While Chinese individual is not allowed to have Joint Venture with foreign investor);
6. The profit distribution of a PE could follow an informal negotiated agreement or abide by scheme adopted in the partnership agreement (While for LLC, profit distributions are according the percentage of investment of shareholders)
Condition(s) -- Foreign Invested Partnership Enterprise (FIPE)
A partnership enterprise must meet the following requirements:
1. At least 2 or more partners
2. A written partnership agreement;
3. Capital contribution subscribed to or actually paid by the partners;
4. A business name and an office in an office building for the partnership enterprise;
Documents required -- Foreign Invested Partnership Enterprise (FIPE)
1. Corporate investor as partner: Certificate of Incorporation, or Articles of formation or equivalent document certified by Chinese embassy or Chinese consulate overseas For individual investor as partner: Passport copy be certified by Chinese embassy or consulate
2. Residential Address Proof (e.g. utility bill issued within 3 months, valid driving licenses with address, National Identity card with address, etc.) be certified by Chinese embassy or consulate
3. Passport copy of: (i) Parent company's director (ii) China Partner Enterprise's general partner and (iii) China Partner Enterprise's partners China general partner and partners provides: 6 photos (2 inches size), brief resume. Registered capital; Business Scope; 8 proposed Chinese names of China business Office address in China, leasing contracts, certificate of real estate ownership, and landlord identification
General Tax -- Foreign Invested Partnership Enterprise (FIPE)
No corporate income tax required. The partners shall pay their respective share of the partnership income.
Terms and Termination -- Foreign Invested Partnership Enterprise (FIPE)
In China, terms of 15 to 30 years are typical for a PE. It is also possible to obtain extensions of the PE's duration.
China Foreign Invested Partnership Enterprise (FIPE) is a good way for foreign investors since the low requirements and easy process. A partnership requires a written agreement between the partners. This written agreement must be submitted to the State Administration of Industrial & Commerce along with the certified passport copy of the partners.
Contact us
We could assist the investors to set up the Foreign Invested Partnership Enterprise (FIPE), Wholly Foreign Owned Enterprise (WFOE), Joint venture (JV) and so on. For further queries, you are welcome to contact ATAHK anytime, anywhere by simply visiting ATAHK’s website www.3737580.net or calling at 86-755-82148419 or emailing to susiehu@citilinkia.com.