The Annual Cooperative Examination

The cooperative examination is a bureaucratic process that all foreign-invested enterprises in China must undertake on an annual basis to ensure all paperwork is up-to-date and valid.

This business license review is a fairly straight-forward process and can be done via the internet, or by going to an office where officials from a total of seven different agencies come together temporarily for this process.

These seven agencies include the Bureau of Foreign Trade and Economic Cooperation (BOFTEC), the Administration of Industry and Commerce (AIC), the Economic Committee, the Financial Bureau, the State Administration of Tax (SAT), the State Administration of Foreign Exchange (SAFE) and China Customs. 

The procedure for the annual cooperative examination for FIEs is as described below.

Preparation for the annual cooperative examination

Every company needs to apply for and obtain the annual cooperative examination documents from the same office of the Administration for Industry and Commerce from which they have obtained their original business license. They must also download the annual cooperative examination report form from the relevant provincial or municipal AIC web site.

Companies must also select one of two options to apply for annual examination-they can apply either through the internet or by taking their documentation directly to the authorities.

Requirements for annual cooperative examination documents

As we have mentioned, there are seven sets of documentation you need to bring together, one for each authority, as follows. Note that all photocopied documents need to be stamped with the enterprise's seal.

Bureau of Foreign Trade and Economic Cooperation

• Original of annual cooperative examination report
• Original and photocopy of approval certificates of foreign invested enterprises
• Audit report issued by CPA firm, or photocopy of capital verification report for enterprises set up after July 1, 2005
• For enterprises in encouraged industries, photocopy of encouraged project confirmation certificate
• For advanced technology enterprises and export enterprises, photocopies of certificates for these two kinds of enterprises

Administration of Industry and Commerce

• Photocopy of annual cooperative examination report
• Audit report issued by CPA firm, or photocopy of capital verification report for enterprises set up after July 1, 2005 and annual financial report as above
• Duplicate of business license

The Economic Committee

• Photocopy of the annual cooperative examination report

The Financial Bureau

• Photocopy of the annual cooperative examination report
• Annual financial statement (full set) of foreign invested enterprises
• Audit report issued by CPA firm
• Photocopy of finance registration

State Administration of Taxation

• Photocopy of the annual cooperative examination report
• Duplicate tax registration certificate for state and local tax
• Audit report issued by CPA firm and annual financial report
• Photocopy of duplicate business license
• Photocopy of capital verification report

State Administration of Foreign Exchange

• Foreign currency registration certificate of foreign invested enterprises
• Audit report of foreign currency issued by CPA firm

China Customs

• Photocopy of the annual cooperative examination report
• Audit report issued by CPA firm and annual financial report
• Original registration certificate for custom declaration

To read the full version of this article, please purchase the January/February 2010 issue of China Briefing, which can be found in the Asia Briefing Bookstore. Companies requiring assistance may contact any Dezan Shira & Associates' nine national offices at china@dezshira.com for advice or visit www.dezshira.com.