China Implements Electronic Business Registration System

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electronic signature
electronic signature

China’s new electronic business license system will be available by the end of October 2017. Companies looking to incorporate in China will go through the application process using one single platform.

Since the implementation of the “Five-in-one business license” and enterprise credit system, the Chinese State Administration for Industry and Commerce (SAIC) has carried on the reform of its investment regime kicked off by Premier Li Keqiang in 2014, setting grounds for the next important milestone in the digitalisation of the business incorporation process.

Background

Before SAIC’s announcement on the countrywide reform, the full online business registration system had been trialled in several cities and provinces in China. On 1 November 2016, the system was implemented in the Haidan District, Beijing for the incorporation of domestic tech limited liability companies. Some cities including Suzhou, Taizhou, and pilot free trade zones, Chongqing and Shanghai, also implemented the system but with limited functions including not being able to register entirely online.

The current incorporation process is handled by several departments and involves queuing for the submission of application documents, several mandatory approvals and the issue of licenses before proceeding to the next step.

The new system

According to SAIC’s Opinions on Promoting the Full Electronic Process for Enterprise Registration, the online registration system covers all types of businesses and applies to all enterprises. Locations meeting therelevant conditions can carry out all paperless business processes including incorporation, alteration, record filing and deregistration which will save time and streamline the application process significantly.

While the electronic registration system is being introduced in certain locations, companies can choose whether to go through the online or window based application process during the transition.

The electronic business registration process, allows companies to register for a user account, file and sign an application and upload all relevant materials. Once the application is submitted, the relevant departments will run through the approval process for the registration request and issue a license.

Guidelines and tools

In order to implement the new system, SAIC has provided some general guidelines and a number of measures and tools, summarised below:

Electronic business license

An electronic business license can be obtained both online and through paper application. If requested in advance, a paper business license is available when obtaining the electronic version.

Online unified identity system

The online identity system allows applicants to register for a user account, which can be registered as both natural persons and juridical persons by submitting relevant identification materials and information. This information will be entered into the identity authentication system and endorsed after which the applicant will have access to the system.

All applicants are responsible for the authenticity and legality of the application materials and documents.

Electronic signature system

All application materials must be signed by the legal signatory on behalf of the company submitting the application, or by the applicant in person. Electronic signatures can be made via mobile phone or computer and must abide by certain standards, be registered and also archived within the system. Application materials bearing the electronic signature of applicants will be deemed as compliant with the statutory form.

Record tracing and electronic archives

All application documents, materials and electronic signatures will have the same legal effect as the paper ones. They will be stored in an electronic archive with a step-by-step registration process that is traceable. The archive includes electronic review forms issued by the registration authority and other data messages that meet the requirements of laws.

Unified standards for the application materials

Once an applicant has submitted the relevant information in the system, the application materials will automatically be generated. The local authorities may also provide the applicant with instruments such as intelligent filing and submission, a reminder for examination and mobile client terminal.

While the full paperless application will be available to applicants who choose to go through the full electronic registration process, no paper documents will be required when submitting the paper application forms at the registration window, unless it is differently indicated by the authorities.

Conclusion

The new system aims to streamline the application process and provide a one-stop solution to revolutionise the process and save time. The technological evolution of this registration platform reflects the intention of the policymakers to be in line with the new era of booming innovation and start-up investments in China.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.