A business license is generally necessary for conducting long-term business operations in China.
Certain online businesses may operate through cross-border e-commerce platforms without a domestic license but might need an ICP commercial license for their website.
What is a Five-in-One Business License?
The five-in-one business license combines tax registration, business license, social security permit, organization code, and statistical registration certificate, simplifying the registration process.
Business License Requirements
- Unified Social Credit Number: An 18-digit code certifying legal business status, essential for transactions with government offices and financial institutions.
- Business Registration Number: Issued after registration, subject to change with the business license.
- Official Company Name: Must include the industry and transaction type, avoiding misleading or inappropriate terms.
- Business Type: Typically described as LLC for foreign companies.
- Legal Representative: The official spokesperson accountable for legal matters.
- Business Scope: Detailed description of planned activities; deviations can lead to penalties.
- Registered Capital: Indicates investor commitment; no legal minimum, but higher amounts reflect financial strength.
- Establishment Date and Operating Period: Declare the foundation date and operating period.
- Registered Business Address: Each company needs a unique address; virtual offices are an option for cost savings.
Registration Process
Applications are submitted online via the State Administration for Industry and Commerce. Requirements include opening a bank account, providing a list of directors, and presenting company chops and a detailed business plan for wholly foreign-owned enterprises.
Costs and Options for Foreigners
Registration costs range from 30,000 to 100,000 RMB. Foreigners can choose between wholly foreign-owned enterprises (WFOE), joint ventures (JV), or representative offices (RO), each with specific requirements and benefits.
Benefits and Challenges
A business license grants full control over marketing strategies and is necessary for an ICP license to launch a localized website. Challenges include language barriers, regulatory complexity, and non-centralized procedures.