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Merger of domestic enterprises by foreign equity (equity merger)

Acceptance, reporting and reply, application code and certificate issuance

1.      The original of the resolution on unanimous approval for the equity merger by foreign investors from shareholders of the merged domestic company limited;

2.      the original of the application for changing into a wholly foreign-funded enterprise by the merged domestic company according to law;

3.      the original of the contract on cooperative business operation of the wholly foreign-funded enterprise established upon the merger (foreign-funded enterprises upon the merger excluded);

4.      the original of the Articles of Association of the wholly foreign-funded enterprise established upon the merger;

5.      the originals of the agreements on equity purchase from shareholders of domestic companies or subscription for capital increase in domestic companies by foreign investors (The aforesaid agreements shall be in compliance with the Chinese laws and cover the following main contents: 1. the information of all parties, including names, domiciles, names of legal representatives, positions and nationalities; 2. the shares amount in the equity purchase or price for subscription for increased capital; 3. the fulfillment term and methods of agreements; 4. rights and obligations of all parties; 5. the solutions on liabilities for breach and disputes; 6. the time and places for signing agreements);

6.      The original of the report on feasibility study on projects;

7.      The copies of financial audit reports of the merged domestic company in recent fiscal years;

8.      The copy of the appraisal report on value of equity planned to be transferred;

9.      The original of remarks on enterprises invested in by the merged domestic company;

10.  The copies of business licenses of the merged domestic company and its invested enterprises;

11.  The original of the employee replacement plan of the merged domestic company;

12.  The copies of legal business certificates and IDs of legal representatives from all investment parties (Foreign investor who invests in his own name shall submit the copy of his ID [foreign investor who is the offshore company registered in areas including British Virgin Islands shall submit the original of good credit certificate issued by the government at the registered place]; the business certificate and personal ID of the foreign investor are subject to the certification by a notary public of the country where he resides and authentication by the Chinese embassy or consulate in that country);

13.  The original of the credit certificate from the foreign bank (foreign investor who invests in his own name shall submit the original of his bank deposit certificate);                              

14.  The originals of resolutions of the Shareholders’ Meeting or directorate meeting and the copy of the special audit report on net assets shall be submitted by Chinese investors (The original of the physical goods list shall be submitted in case of investment with physical goods; foreign-funded enterprises upon the merger excluded);

15.  The disposal agreement on creditor’s rights and debt;

16.  The remarks on whether all parties of the merger have the connected relations or not;

17.  The originals of lists of the company’s directors and that of its General Manager and Deputy General Manager upon the merger; 

18.  The originals of references for accreditation and copies of IDs of directors, supervisors, General Manager and Deputy General Manager;

19.  The original of registration form of the Chinese senior management (referred to the designated directors, General Manager and Deputy General Manager; foreign-funded enterprises upon the merger excluded); 

20.  The copies of letter of attorney on commissioned application business (i.e., the agency agreement) and business license of application agency (except for the application made by the investor itself);

21.  The documents of business scope, scale and land use right of the wholly foreign-funded enterprise established upon the merger. Relevant permit document shall also be submitted at the same time in case of other relevant governmental authorities involved;

22.  Other documents required based on actual situation (such as the original of the authorization from legal representative, the copy of ID of licensee, the originals of imported equipment list and credit guarantee letter, the appraisal certificate of state-owned assets and the approval letter from the Chinese superior authority);  

23.  The appraisal document on influence on environment issued by the environmental protection authority. Relevant examination and approval document from the land administration authority shall also be submitted in case of the civil engineering involved.

Notes: 1. The foreign investor who conducts the merger of domestic company by the payment way of equity shall report it to the Ministry of Commerce of the People’s Republic of China for examination and approval. Apart from the aforesaid documents, the domestic company shall also submit the following documents:

I.                   the remarks on changes in equity and significant assets of the domestic company in the last year;

II.                the report on the merger consultant;

III.             the certificates of business and IDs of companies at home and abroad and their shareholders involved;

IV.             the remarks on shareholders’ shareholding in the overseas company and the list of shareholders holding more than 5% equity in the overseas company;

V.                the Articles of Association and remarks on outward guarantees of the overseas company;

VI.             the audited financial report in recent years and the report on stock trading in the past six months of the overseas company.

(Notes: The company’s official seal shall be affixed to the aforesaid copy-required materials.)

30 working days

The submission to the Shanghai Foreign Investment Commission shall be conducted within 5 working days.

RMB10 for certificate fee