Administrative Provisions on the Registration of Companies' Registered Capital |
It was decided at the executive meeting of the State Administration for Industry and Commerce of the People's Republic of China to revise the Administrative Provisions on the Registration of Companies' Registered Capital, which are hereby promulgated and shall be implemented as of January 1, 2006. Order of the State Administration for Industry and Commerce of the People's Republic of China (No. 22) Article 1 With a view to strengthening the administration of the registration of registered capital and paid-in capital of companies, and regulating the registration acts of companies, the present Provisions are formulated in accordance with the Company Law of the People's Republic of China (hereinafter referred to as the Company Law) and the Regulation of the People's Republic of China on the Administration of Company Registration (hereinafter referred to the Regulations on the Administration of Company Registration). Article 2 The registered capital of a limited liability company is the amount of capital contributions paid by all the shareholders who have been lawfully registered in a company registration organ. Where a joint stock limited company is established by way of promotion, the registered capital shall be the total equity subscribed to by all the promoters who have lawfully registered in a company registration organ. Where a joint stock limited company is established by way of public offering, the registered capital shall be the total amount of all paid-in equity lawfully registered in a company registration organ. Article 3 The paid-in capital of a company shall be the amount of capital contributions or total amount of equity actually paid by all the shareholders or the promoters and lawfully registered in a company registration organ. Article 4 A company registration organ shall register the registered capital according to the laws, administrative regulations, and other relevant provisions of the state. It shall register the registered capital if it meets pertinent requirements; it shall reject to do so if the registered capital does not meet pertinent requirements. Article 5 A company's amount of registered capital and paid-in capital and the time and ways of capital contributions by shareholders or promoters shall be in line with relevant laws and administrative regulations. Article 6 Where shareholders or promoters make their initial capital contributions when a company is established, or where the company alters its registered capital or paid-in capital, it shall be subject to capital verification by a lawfully established capital verification institution, which shall issue a capital verification certificate. Article 7 The non-monetary property contributed by any shareholder or promoter shall be subject to assessment-based pricing by a qualified asset evaluation institution, and then verified by a capital verification institution. Article 8 A shareholder or promoter may make capital contributions in cash, in kind, with intellectual property right, land use right, or other non-monetary properties that may be assessed on the basis of currency and may be transferred in accordance with the law. In case a shareholder or promoter makes its capital contribution by any other property than cash, physical objects, intellectual property right, or land use right, which shall comply with the relevant provisions formulated by the SAIC together with the relevant departments of the State Council. No shareholder or promoter may make capital contribution by pricing labor services, credit, name of a natural person, credit standing, or franchising right, or property on which there is a guaranty, etc. on the basis of valuation. Article 9 A shareholder or promoter shall pay the capital contribution in his own name. Article 10 The minimum registered capital of a limited liability company shall be RMB 30,000 Yuan, the minimum registered capital of a one-person limited company shall be RMB 100,000 Yuan, the minimum registered capital of a joint stock limited company shall be RMB 5 million Yuan. In case there is any requirement for a higher minimum registered capital of a limited liability company or joint stock limited company by any law or administrative regulation, such provisions shall be followed.The amount of monetary capital contribution of all the shareholders or promoters of a company shall be no less than 30% of the registered capital of the company.The shares subscribed by the promoters of a joint stock limited company that is established by way of public offering shall be no less than 35% of the total shares of the company, unless it is otherwise specified differently by any law or administrative regulation, such provisions shall prevail. Article 11 The amount of initial capital contribution of all the shareholders of a limited company shall be no less than 20% of the company's registered capital, nor shall it be lower than the minimum amount of the legal registered capital, other part of the registered capital shall be paid in full amount within 2 years as of the date of the establishment of the company; for an investment company, the registered capital may be fully paid within 5 years. Article 12 The shareholders or promoters shall pay the amount of contributions or the shares they have subscribed to by themselves in a timely fashion and in full amount as prescribed in the articles of associations. In case the capital contribution is made in cash, the cash contribution shall be deposited into the account opened by the company in a bank in full amount; if the capital contribution is made by non-monetary property, the shareholders or the promoters shall go through the formalities for the transfer of the property right. When a company makes registration on its establishment, if the initial capital contribution of the shareholders or promoters is made in non-monetary property, it shall submit the certificate documents for the handling of the formalities for the transfer of property right. After a company is established, the shareholders or the promoters shall pay capital contribution within the time of capital contribution as prescribed in the articles of association of the company; if it is non-monetary property, it shall apply for handling the registration on the alteration of the paid-in capital of the company after having gone through the formalities for the transfer of property right. Article 13 A capital verification certificate for the establishment of a company shall contain:
Article 14 When a company increases its registered capital, the capital contributions paid by the shareholders of a limited company for the increased amount and the new shares subscribed to by the shareholders of a joint stock limited company shall be governed by the relevant provisions of the Company Law on the payment of capital contributions and capital stocks for establishing a limited company or a joint stock limited company. In case a joint stock limited company increases its registered capital by public issuance of new shares or a listed company increases its registered capital by way of non-public issuance of new shares, the documents of approval of the security regulatory institution under the State Council shall also be submitted. Article 15 When a company reduces its registered capital, it shall comply with the procedures as prescribed in the Company Law. The amount of registered capital and paid-in capital after the reduction shall reach the minimum amount as prescribed in the laws and administrative regulations and shall be subject to capital verification of a capital verification institution. If a company applies for reducing its registered capital after all its shareholders or promoters have fully paid the capital contribution and the capital stock, it shall handle alteration registration for reducing the paid-in capital at the same time. Article 16 In case a limited liability company purchases any of the stock right of its shareholders in accordance with Article75 of the Company Law, it shall apply for alteration registration on reducing the registered capital and the corresponding paid-in capital. Article 17 If a non-corporate enterprise is restructured into a company according to the Company Law, or a limited company is changed into a joint stock limited company, the total amount of paid-in equity converted shall be no more than the amount of net assets of the company. In case a limited company is changed into a joint stock limited company and issues shares publicly for increasing its capital, it shall do it according to law. Article 18 The registered capital and the amount of capital contribution of shareholders of a company, or the amount of capital subscribed by promoters, and time and ways of capital contribution or subscription shall be prescribed by the articles of association of the company. In case there is any alteration on the amount of registered capital and paid-in capital of a company, the amount of capital contributions of shareholders or the amount of capital subscribed to by the promoters, and the time and ways of capital contribution or subscription, the company shall amend its articles of association and apply for handling alteration registration to the company registration organ according to law. Article 19 The capital verification certificate for the changed registered capital and paid-in capital of a company shall contain:
Article 20 After a company is established, if the actual value of the capital contribution made in kind, with industrial property right, land use right, or other non-monetary property by shareholders or promoters is apparently less than that as specified in the articles of association of the company, the shareholder or promoter who pay such capital contribution shall make up the margin. The investment made in kind, with industrial property right, land use right, or other non-monetary property shall be re-priced by assessment. The paid-in capital of the company shall be verified again and issued a capital verification certificate by a capital verification institution. Article 21 After the establishment of a company, if the company registration organ finds that the company involves any false paid-in capital, it may demand the company to accept verification at a capital verification institution designated by it, and require it to submit a capital verification certificate within a specified time limit. Article 22 In case a company obtains company registration by falsely reporting its registered capital, the company registration organ shall give it a punishment in accordance with Article 68 of the Regulation on the Administration of Company Registration. Article 23 In case any shareholder or promoter of a company makes false capital contribution, fails to deliver or fails to deliver on schedule the capital contribution of cash or non-monetary properties, the company registration organ shall give him/her a punishment in accordance with Article73 of the Regulation on the Administration of Company Registration. If a shareholder or promoter of the company refuses to correct, the company registration organ shall order the company to handle alteration registration on the registered capital and the time for capital contribution; if it fails to do so, it shall be punished in accordance with Article73 of the Regulation on the Administration of Company Registration. Two years after a company is established, if it is an investment company, five years after it is established, the shareholders or promoters of the company still have not paid or have not paid in full amount the capital contribution, and the company still has not gone through alteration registration, it shall be punished in accordance with Article68 of the Regulation on the Administration of Company Registration. Article 24 In case any shareholder or promoter withdraws its capital contribution after a company is established, the company registration organ shall give him/her a punishment in accordance with Article71 of the Regulation on the Administration of Company Registration. Article 25 In case there is any alteration on the registered capital or the paid-in capital of a company, but the company fails to handle the alteration registration in a timely fashion, the company registration organ shall give it a punishment in accordance with Article73 of the Regulation on the Administration of Company Registration. Article 26 In case any capital verification institution or capital assessment institution issues false certification documents, the company registration organ shall give it a punishment in accordance with Article79 of the Regulation on the Administration of Company Registration. Article 27 In case the revocation of registration alteration of a company involves the alteration of the registered capital of the company and the amount and ways of capital contribution of any shareholder or promoter, the company shall be resumed to the pre-registration status. Article 28 The present Provisions shall be applicable to the registration administration on the registered capital and paid-in capital of foreign-funded enterprises, unless it is otherwise specified differently by any law. Article 29 The present Provisions shall come into force as of January 1st, 2006. The Administrative Provisions on the Registration of Companies' Registered Capital, which were promulgated by the State Administration for Industry and Commerce on June 14, 2004, shall be repealed simultaneously.
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