Guide to Setting up a Representative Office (RO) in the Shenzhen Special Economic Zone, China

1. Introduction

After thorough analysis and evaluation, you have come to the conclusion that a Representative Office in the Shenzhen Special Economic Zone, China, is the right move for your company in making the first presence in China. What to do next? The purpose of this article is to provide foreign investors with a general understanding of the procedures and materials required in setting up a Representative Office in Shenzhen, China.

2. Procedures to Setting up a Representative Office in Shenzhen

The procedures for registration of a Permanent Representative Office in Shenzhen can be summarised into a three-step process: step 1 is the preparation of application materials, step 2 is the application for registration certificate and the last step is the post-registration procedures.

(1) Step 1: Pre-registration Procedure

(a) Designate a Chief Representative of the proposed Representative Office. The Chief Representative is the person who will be responsible for managing the Representative Office and there is not any restriction on the nationality and residence of the Chief Representative;
(b) Arrange to have the incorporation documents of your company (the company applying to set up the Representative Office, “the Company”) legalised by the Chinese Embassy in the country where your company is registered.
(c) Apply for a reference letter from the banker of your company;
(d) Lease an office in Shenzhen and conclude a tenancy agreement (lease) for the office.

(2) Step 2: Application for Registration Certificate

The second step is to apply for registration (certificate) with Shenzhen Administration Bureau for Industry and Commerce; and once the Permanent Representative Office Registration Certificate is issued, the post-registration procedures as listed in Step 3 below then need to be performed.

(3) Step 3: Post establishment Registration Procedures

Upon the issuance of the Permanent Representative Office Registration Certificate, we will then perform the post-establishment registration procedures, including:

(a) Engraving of Office Stamp (after apply for approval from the Public Security Department of Shenzhen Public Security Bureau) by authorized common seal manufacturer;
(b) Registration with State Administration of Taxation Shenzhen Branch and application for State Tax Registration Certificate;
(c) Registration with Shenzhen Municipal Bureau for Local Tax and application for Local Tax Registration Certificate;
(d) Registration with Shenzhen Organisation and Institution Identification Code Management Center and application of Enterprise Organisational Code and card (from)
(e) Registration with Shenzhen Branch of the State Administration of Foreign Exchange and application for Registration Certificate of Foreign Exchange;
(f) Establishment of bank accounts with any bank of your choice in Shenzhen.

(4) Optional Procedures

(a) Application for Work Permit for (Chief) Representative (applicable to the representative with a citizenship of a foreign country or of Taiwan, Hong Kong and Macau), and
(b) Application for long-time residential permit (from the Exit and Entry Department of Shenzhen Public Security Bureau)
(c) Application for the importation of the appliances for office and personal daily use

3. Summary of materials required for the application for Registration of a Representative Office

The foreign company applying to set up the Permanent Representative Office is responsible for the preparation of the following information and documents:

(1) Two set of legalised (by Chinese Embassy or Consulate) incorporation documents of the Company;

(2) One original bankers’ reference letter issued in the name of the Company and addressed to Shenzhen Administration Bureau for Industry and Commerce;

(3) Two original copies of Tenancy Agreement (lease agreement) of the office premise to be used by the Representative Office; the lease term should not be less than 12 months. The tenancy must be entered into in the name of the Company, and signed by the legal representative (or managing director of the Company);

(4) A brief summary of the operations and business of the applicant company, such as the principal business activities, registered address, contact phone number, name of the applicant company; the address and contact number of the managing director of the applicant company;

(5) A copy of resume, 4 pictures, passport copy (only the page detailing the particulars of the holder; to be signed and stamped with company chop) and contact number of the Chief Representative and the address where the Chief Representative will be staying while she/he is China.
If the chief representative is a Chinese citizen, please provide us his/her employment contract with the local foreign service companies or other entities designated by the local government;

(6) If there is(are) Representative(s) to be stationed in China in addition to the Chief Representative, the resume, 2 pictures, passport copy, contact telephone number of each Representative and the address where the Representative will be staying while she/he is China;

4. Time Frame to Complete to RO Registration

Note (1): Incorporation Documents

If the Company is registered in Hong Kong, the incorporation documents include:

the Certificate of Incorporation
the Business Registration Certificate
Form D1, Form D3 and Form R1
Form AR1 if any

These documents are to be legalised by attesting officers authorised by the China’s Ministry of Justice and practicing in Hong Kong.

If the Company is registered the USA and it is a LLC, the incorporation documents refer to Certificate of Formation, and if it is a corporation, the Articles of Incorporation and bylaw;

If the Company is registered in other country, the incororation documents refer to registration documents filed with or issued by the competent business registration offices.

Note (2): Bankers Reference Letter

The bankers’ reference letter is a letter issued by the Company’s banker. It normally contains the bankers’ comments as to the credit standing of the Company. Sometimes it could be that the Company is a new company and just established a bank account, as such, the bank is unlikely to comment on the credit standing of the Company. In this case, the Company could ask the bank to issue a statement stating the bank balance as of a recent date or the average daily balance over a period of last three months.

Note (3): Tenancy Agreement

The tenancy agreement is a very important document for the purpose of registration of Representative Office. Before submitting application to the Shenzhen Administrative Bureau, the Company must lease an office premise in which the Representative Office will conduct its business and sign a tenancy agreement for that office premise.

The office premise must be in a commercia building and the nature of the premise must be for commercial use only. In addition, the tenancy agreement must be registered with Shenzhen Housing Management Bureau.

Note (4): Requirement of the Investor

The company which applies to set up the representative office must have been in existence for more than two years.