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Frequently Asked Questions

FAQ16- What are the rules for foreign shipping companies to set up their solely owned companies in China?

To regulate investment and operation of foreign shipping companies in China and protect the legitimate rights and interests of investors, the Chinese Ministry of Communications and the Ministry of Foreign Trade and Economic Cooperation have promulgated the Provisional Regulations on the Examination and Approval of Wholly Foreign-funded Shipping Companies, permitting foreign shipping companies to set up wholly owned shipping companies in China. Major stipulations are as follows:

1). An applicant for the establishment of a wholly owned shipping company must meet the following requirements:

  • It should have experience of no less than 15 years in shipping business;
  • It should have had a permanent representative office approved by the Ministry of Communications for no less than three years in the port city where the solely owned shipping company is to be located;
  • Its regular passenger or cargo ship should call no less than once a month at a harbor in the city where the solely owned shipping company is to be located (those who operate shipping routes in the forms of joint consignment, shipping space swap and joint operation and who have obtained operation permits for such routes are deemed to have met the relevant requirements);
    Foreign shipping businesses that are engaged in tramp transport should have a stable source of shipment in China.
  • Its operations in China are free for two successive years from any violation of the Chinese laws, administrative statutes and relevant regulations.

2). To apply for the establishment of a wholly owned shipping company, the applicant should submit the following documents:

  • Application;
  • Feasibility study report;
  • Articles of corporation;
  • Legal documents and credit status documents of the applicant;
  • A letter of entrustment from the legal representative of the wholly owned shipping company and the name list and resume of the members of the Board of Directors;
  • Sample of the bill of lading;
  • Xeroxed copy of the permit for operating shipping routes and documents approving the permanent representative office; and
  • Other documents requested by the Ministry of Foreign Trade and Economic Cooperation and the Ministry of Communications.

3). Rules and Procedures for Examination and Approval

The application by a foreign shipping business for the establishment of a wholly owned shipping company in China must be examined and approved in accordance with the shipping agreement between the Chinese government and the government of the foreign shipping business and pertinent legal documents.

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