Business License Application in China: A Complete Guide

1. Overview

A business license is the foundational legal document for operating a company in China. Issued by the State Administration for Market Regulation (SAMR) and its local counterparts, it serves as official proof of a company's legal establishment and grants it the right to conduct business within approved scopes. The license contains key information such as the company's unified social credit code, legal representative, registered capital, business scope, and address. Obtaining a business license is a mandatory step in the company registration process and is required before commencing any commercial activities, opening corporate bank accounts, or signing official contracts.

2. Applicable Objects & Scenarios

This process applies to:

• Domestic Enterprises: Including Limited Liability Companies (LLCs), Joint Stock Companies, partnerships, and sole proprietorships established by Chinese citizens or entities.
• Foreign-Invested Enterprises (FIEs): Wholly Foreign-Owned Enterprises (WFOEs), Sino-foreign Joint Ventures, and Foreign-Invested Partnerships.
• Branch Offices: Branches of existing domestic or foreign companies operating within China.
• Representative Offices: Offices of foreign companies (with limited operational scope).

You need to apply for a business license when:

• Establishing a new company or commercial entity in China.
• Making significant changes to registered information (e.g., change of legal representative, address, registered capital, or business scope).
• Renewing a license if required by specific regulations (though most modern licenses are issued for long-term validity under the "multi-certificate合一" reform).
• Replacing a lost or damaged license.

3. Core Conclusions

• Mandatory First Step: A business license is legally required before any operational activity begins.
• Unified Process: The application is integrated into the overall company registration process via the "One-Window Service" system.
• Pre-approval for Scope: Certain business activities require pre-approvals or licenses from other government bodies before they can be listed on the business license.
• Digital & Physical Copies: An electronic version of the license holds equal legal validity as the physical copy.
• Public Record: Key license information is publicly accessible through the National Enterprise Credit Information Publicity System.

4. Procedures & Steps

Step 1: Preparation

1. Determine Company Structure: Choose the appropriate entity type (e.g., WFOE, LLC).
2. Reserve Company Name: Submit proposed names (in Chinese) through the local Administration for Market Regulation (AMR) online system for approval.
3. Draft Corporate Documents: Prepare the Articles of Association, list of shareholders/directors/supervisor, and appointment letters.
4. Secure Registered Address: Obtain a proof of address (e.g., property ownership certificate or lease agreement) for the company's domicile.
5. Define Business Scope: Precisely define the intended business activities. Consult the "National Classification of Economic Activities" to select correct codes. Note if any items require pre-approvals.
6. Determine Registered Capital: Decide on the amount and contribution schedule (subscription system is generally applied).

Step 2: Application & Submission

1. Compile Application Package: This typically includes:
   • Application Form for Company Establishment Registration.
   • Approved Company Name Reservation Notice.
   • Proof of address for the domicile.
   • Identity documents of legal representative, directors, supervisor, and shareholders.
   • Articles of Association.
   • For FIEs: Additional documents like the Approval Certificate from the Ministry of Commerce (MOFCOM) or its local branch are required (note: for many sectors, MOFCOM filing is integrated into the AMR process post-2020 reforms).
2. Submit Application: Submit all documents, either online via the local AMR's "Enterprise Online Registration System" or in person at the government service hall's "Enterprise Registration" window.

Step 3: Review & Confirmation

1. Official Review: The AMR reviews the submitted materials for completeness and compliance. The review period is typically within a few working days.
2. Receive Approval: Upon approval, the applicant will be notified to collect the "Business License of Enterprise Legal Person".
3. Post-License Formalities: After obtaining the license, the company must complete subsequent procedures, including:
   • Carving and filing the company seal.
   • Opening a basic corporate bank account.
   • Tax registration with the State Taxation Administration (handled together with the license application in most jurisdictions).
   • Social security and housing fund registration.

5. Frequently Asked Questions (FAQ)

Q1: How long does it take to get a business license in China? A: For a standard application with complete and correct documents, the review and issuance by the AMR usually takes 3 to 7 working days. The entire setup process, including pre-approvals and post-license steps, can take several weeks.

Q2: What is the cost or government fee for a business license? A: The official registration fee for issuing the business license has been waived in most regions of China to encourage business formation. However, there are costs associated with other steps, such as notarization/legalization of foreign documents, capital verification (if required), and seal carving. Please verify with official sources.

Q3: Can I apply for a business license entirely online? A: Yes, most local AMRs offer a comprehensive online application system. The entire process, from name reservation to document submission, can be completed online. The physical license can often be mailed to the applicant.

Q4: What is the difference between a "Registered Capital" and "Paid-in Capital"? A: Registered Capital is the total capital amount subscribed by all shareholders, as stated in the Articles of Association. Paid-in Capital is the portion that has actually been contributed. China primarily uses a "subscription system," where shareholders agree on a contribution schedule, meaning the registered capital does not need to be fully paid upfront at registration.

Q5: Can I change my business scope after the license is issued? A: Yes, but it requires filing a change registration with the AMR. Adding business activities that require special pre-approvals will necessitate obtaining those approvals from the relevant authorities before the AMR can update the license.

Q6: Is a physical office address always required? A: Generally, yes. A valid, non-virtual address in China is required for registration. Some cities offer cluster registration addresses for specific types of startups, but regulations vary by location.

6. Risks & Compliance

• Accuracy is Critical: Ensure all information submitted (especially company name, legal representative identity, registered address, and business scope) is accurate and truthful. False information can lead to fines, license revocation, or legal liability.
• Compliance with Business Scope: Companies must operate strictly within the approved business scope listed on the license. Operating beyond this scope is illegal.
• License Display: The business license (or its electronic version) must be prominently displayed at the company's domicile.
• Timely Updates: Any change to the licensed information (e.g., address change, capital change) must be reported to the AMR within the statutory timeframe to apply for a license update.
• Disclaimer: This guide provides general information. Regulations and procedures are subject to change and may vary by region and industry. It is essential to consult with the local Administration for Market Regulation or a professional business advisory service for the most current and specific guidance.

7. References & Sources

• State Administration for Market Regulation (SAMR): http://www.samr.gov.cn/ - The primary national regulator.
• National Enterprise Credit Information Publicity System: http://www.gsxt.gov.cn/ - Official platform to search and verify business license information of Chinese companies.
• China’s Company Law: The fundamental law governing the establishment and operation of companies.
• Regulations on the Administration of Company Registration: The core regulation detailing registration procedures.
• Local Government Service Websites: Each city/county has an online government service portal hosting the local "Enterprise Registration System" (e.g., Beijing: http://banshi.beijing.gov.cn/).

8. Related Topics

• Company Name Reservation in China
• Foreign-Invested Enterprise (FIE) Establishment
• Company Seal Carving and Filing in China
• Corporate Bank Account Opening in China
• Tax Registration for New Companies in China
• Annual Reporting and Compliance for Chinese Companies