The new "One Window Service" for FIEs in Pudong

In March, the authorities initiated a Pilot project for the Pudong area in Shanghai, the “One Window Service”, concerning the Establishment and Change of Registration of Foreign Invested Enterprises (FIEs). This initiative applies to FIEs in the “encouraged” and “permitted” categories, and with a total amount of investment below 100 million dollars.

The main point is to regroup 5 different administrative procedures in one (Approval Letter and Certificate of Approval, Business License, Organizational Code Certificate, Tax Registration Certificate and Food License). Under this procedure, all these certificates can be directly submitted to and processed by the Pudong authorities. The process is much shorter : 5 working days only.

But whether this is a good opportunity depends on the point of view… In order to benefit of the “One Window Service”, the applicant must use the template application documents provided by the Pudong authorities, including the Articles of Association and Joint Venture Contract.
The good side of it is that it takes less time than the case where the applicant uses its own application documents instead of the template documents provided by Pudong authorities. The downside is that you do not control the content of your Articles of Association and Joint Venture Contract, which are precisely the two documents you want to pay a close attention to, specially the phrasing of the different clauses therein.

As such, you should weight very carefully the pros and cons of saving some time compared to the disadvantages which may result from contracts which do not fully reflect the interests and intentions of the parties.