China Regulatory Brief: Social Insurance Contribution Amount and Registered Capital Requirement

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China-Regulatory-Brief
China Reduces the Social Insurance Contribution Amount of Employers

On June 24, Chinese Premier Li Keqiang announced his decision to reduce the contribution amount for employers in the work injury and maternity insurances. Specifically, the average work injury contribution percentage for employers will be reduced from one percent to 0.75 percent; and the percentage of maternity insurance contribution shall be reduced from the current one percent maximum to 0.5 percent, starting October 1, 2015. There are five categories of social security funds that employers in China need to contribute to: pension, medical, unemployment, maternity and work injury insurance. Both the employer and employee need to contribute to each of the abovementioned categories, but at different percentages. 

China Abolishes the Minimum Registered Capital Requirement for Assets Appraisal Institutions

China’s Ministry of Finance has recently released a notice removing the minimum registered capital requirements for setting up corporate asset appraisal companies. Previously, investors needed to have a minimum registered capital of RMB 300,000 to set up such an institution. Along with the implementation of the new Company Law, China eliminated the minimum levels of registered capital last year and replaced the paid-up capital registration regime with a subscribed capital registration regime. However, certain industries including finance and insurance companies have not been allowed to complete the business registration process solely based on subscribed capital, but instead must fulfill the paid-in capital requirements.

Related Link IconRELATED: China to Lower Incorporation Requirements

Shanghai Permits the Use of “Entrepreneurship Incubator” in Company’s Name

On June 23, the Shanghai Municipal Administration for Industry & Commerce (AIC) decided to allow companies to use such wording as “mass entrepreneurship (as in Chinese 众创空间),” “creator space (创客空间)” and “entrepreneurship incubator (创业孵化器)” in the company’s name. Companies are also permitted to change their business scope to cover mass entrepreneurship operation and management. The Shanghai AIC is also looking to launch a pilot program to carry out equity crowdfunding projects and companies registration procedures. Such equity crowdfunding companies will be allowed to raise monetary contributions from ordinary investors, which may become the company’s shareholders by making capital contribution. 

Beijing Simplifies Procedures for Foreigners Purchasing Apartments in Beijing

On June 24, the Beijing Municipal Housing & Urban Construction Commission and the Beijing Municipal Bureau of Public Security Jointly released the “Notice on Further Standardizing Purchase of Commercial Housing by Foreigners in Beijing.” According to the Notice, foreigners will no longer be required to submit a hard copy of the “Certificate of Residence Status of Overseas Individuals in China” when looking to purchase an apartment in Beijing. Instead, the two bureaus will examine whether the overseas individual is eligible for purchasing apartments in Beijing online.


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