A discussion about the necessary legal aspects of investment in the peoples republic of china

A joint venture shall provide statistical documents and submit statistical forms according to the Statistics Law of the People's Republic of China and to the provisions on the statistics system of utilization of foreign investment of China.

When the examination and approval authority deems necessary, it may send personnel to supervise the process. Any increase, reduction of the registered capital of a joint venture shall be approved by a meeting of the board of directors and submitted to the examination and approval authority for approval.

Projects of a development nature in economically undeveloped areas shall receive special preferential treatment in respect of site use fees with consent of the local people's government. In its purchase of required machinery, equipment, raw materials, fuel, parts, means of transport and things for office use, etc.

Article 3. A joint venture may be dissolved in the following situations: 1 Termination of duration; 2 Inability to continue operations due to heavy losses; 3 Inability to continue operations due to the failure of one of the contracting parties to fulfill the obligations prescribed by the agreement, contract and articles of association; 4 Inability to continue operations due to heavy losses caused by force majeure such as natural calamities and wars, etc.

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The sub-division set up by a joint venture in foreign countries or in Hongkong or Macao shall submit its annual statement of assets and liabilities and annual profit report to the State General Administration of Foreign Exchange Control or one of its branches through the joint venture.

Delay in payment or partial delay in payment will be subject to a payment of interest on arrears or a compensation for the loss as defined in the contract.

When one party assigns his investment subscribed to a third party, the conditions given shall not be more favourable than those given to the other party to the joint venture.

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Law of the People's Republic of China on Joint Ventures Using Chinese and Foreign Investment