Establishing a Foreign Investment Commercial Enterprise (FICE) in China
When an international company reaches a certain level of success in selling or trading with China, or simply wants a physical presence in the country, it’s common to establish a trading company in the form of a Foreign Investment Commercial Enterprise (FICE).
Permitted FICE Activities:
- Expanding sourcing platform and direct care for logistics and quality control
- Purchasing finished or semi-finished products for resale in China as an intermediary
- Importing goods for direct wholesale or retail sale
- Establishing fully operational sales platform and after-sales services
- Working as a support and liaison office for overseas headquarters
Covered Scope:
FICE refers to a foreign investment enterprise engaged in:
Retail: Selling goods from fixed locations or via television, phone, mail, internet, and vending machines.
Wholesale: Selling goods to retailers, industrial and commercial customers, and other wholesalers.
Franchising: Licensing the use of trademarks, trade names, and operational models in exchange for royalties or franchise fees.
Commission Agency Activities: Working as a sales agent, broker, or auctioneer for goods.
Basic Requirements for Establishment:
Foreign investors must meet the following criteria:
- Possess good reputation
- Not commit acts that violate Chinese laws
- Ability to meet the required ratio between registered capital and total investment
Restrictions:
Restrictions apply to FICE dealing in specific products like books, periodicals, newspapers, pharmaceutical products, and agricultural chemicals.
Operating Duration:
FICE operating duration should generally not exceed 30 years, while FICE established in central and western regions should generally not exceed 40 years.
Required Application Documents:
- Written application form
- Feasibility study report signed by all investors
- Contract and internal regulations and their attachments
- Bank credit certificates and registration for each investor
- Audit report for the last year by an accounting company
- Catalog of goods imported and/or exported by the FICE