102.81/7–346: Telegram

The Counselor of Embassy in China ( Smyth ) to the Secretary of State

1083. For Commerce. Reference Shanghai consular telegram 1162, June 28 and Embassy’s telegram 1060, June 2922 (repeated Shanghai as 430), concerning registration of foreign companies.

Previous “deadlines” for registration of foreign companies represented a deferment of registration requirements pending promulgation of company law. Since that law is now in force (since April 12,) companies legally are required to register under its provisions in order to carry on business. Article 292 provides: “A foreign company shall not transact business or establish a branch office within the territory of China without a certificate of authority given after admission and cannot apply for admission without incorporation in its own country”. Also article 296 requires, with respect to establishment of additional branch offices by foreign countries already admitted to do business in China, that application be made through local competent authorities within 15 days after establishment of such branch offices.

While legally therefore situation requires immediate application for admission by companies now operating or desiring to commence operations in China, we are informed by head of commercial section, Ministry Economic Affairs, who is directly responsible for registration of foreign companies, that blank forms for registration applications are not yet available and that “certificates of authority” also are not yet prepared. He states that foreign firms already operating in China should apply to Ministry Economic Affairs as “soon as possible” by writing a letter setting forth the information and attachments called for in articles 294 and 354 of the revised company law.

Sent to Shanghai [as] 436; repeated to Washington 1083.

  1. Neither printed.