Sino-foreign joint venture contract (plastic products)

table of Contents

1) General 2) Registered capital 3) Approval and registration 4) Capital transfer 5) Board of directors 6) General manager, deputy general manager 7) Venue use fee 8) Technical cooperation 9) Procurement and sales 10) Profit 11) Financial accounting 12) Foreign exchange receipts and payments 13) Tax 14) Employee recruitment and rewards 15) Salary standards and awards 16) Joint venture period 17) Other matters 18) Arbitration 19) Contract text 20) Legal address, file notice

_____, _____ and _____, _____, _____, in accordance with the "Sino-foreign Joint Venture Enterprise Law of the People's Republic of China" and the "Implementation Regulations", in accordance with the principle of equality and mutual benefit, establish a joint venture in the city of _____, the People's Republic of China. Engaged in the production of reflectors, injection molds and other data products for export and sales within the territory of the People's Republic of China. After many discussions, unanimously agreed to enter into this contract.

Chapter I General

1. The parties to this contract are:

_____, _____ is one party, and _____ is responsible for this contract on behalf of Party A.

_____, _____, _____ are one party, and _____ is responsible for this contract on behalf of Party B.

This contract is signed by a representative authorized by both Party A and Party B.

2. The joint venture agreed by both parties is named: _____

Chinese: _____
English: _____
Address: _____

3. In accordance with the principle of equality and mutual benefit, the two sides engage in the design, production and internal and external sales of reflectors, injection molds and other plastic products in order to facilitate the development of China's national economy.

The joint venture will try its best to procure raw materials and packaging materials within the territory of the People's Republic of China. If there is no supply or quality, and the price does not meet the requirements, it can also be solved by the joint venture.

4. Based on the long-term sincere cooperation, the two parties strive to achieve the advanced level of international similar products in terms of product quality, specifications, packaging and economic benefits.

The initial production scale of the joint venture is: _____ sets of _____ reflectors that meet the _____ national _____ standard, and accept injection molding molds with an annual production value of _____ yuan. Party B is responsible for the return of the _____ reflector, ensuring that the foreign exchange receipts and payments of the joint venture will reach their own balance in the first _____ years after the production. And after _____ years, the proportion of return sales is not less than _____%. Party B is responsible for the joint venture enterprise to undertake orders for injection molds of not less than _____ yuan per year from outside China. Party A is responsible for the domestic sales of the joint venture products.

5. A joint venture is a legal person of the People's Republic of China and must abide by the relevant laws, decrees, regulations and rules of the People's Republic of China and be governed and protected by the laws of the People's Republic of China.

Chapter II Registered Capital

6. The joint venture is a limited liability company. The economic responsibility of each party is limited to the registered capital, and the profit is distributed according to the proportion of capital, sharing the risks and losses.

7. The total investment of the joint venture is _____ USD. Note that the total capital is _____ US dollars, of which Party A accounts for _____% of the capital, and Party B accounts for _____% of the capital.

8. Party A and Party B contribute as follows:

Party A: _____ USD, of which:

Machine equipment, worth about _____ US dollars;
Plant, valued at approximately _____ US dollars;
Cash, equivalent to _____ dollars in renminbi cash.

Party B: _____ USD foreign exchange cash.

Chapter III Approval and Registration

9. This contract shall be approved by _____ City and shall become effective on the date of approval. And sent to the Ministry of Foreign Trade and Economic Cooperation of the People's Republic of China for the record

10. Upon receipt of the above-mentioned approval certificate, the joint venture shall register with the Administration for Industry and Commerce and obtain a business license. After the joint venture obtains the business license, Party A and Party B will pay the funds separately according to the progress of the project. The amount payable by each party shall be decided by the board of directors.

After the parties have paid the capital, the joint venture will issue an investment certificate.

Chapter IV Capital Transfer

11. The joint venturer has the right to buy first when the registered capital is transferred, and may not be transferred or mortgaged to him without the consent of the joint venturer. However, when a party proposes a transfer, the joint venturer should give a reply within _____ months, otherwise it will be abandoning the first call.

12. The price of the transfer of registered capital shall be settled by the parties to the joint venture in accordance with the principle of fairness and reasonableness based on the book value of the investment of the party in the joint venture.

13. When the registered capital is transferred, it shall apply to the original examination and approval authority for approval within _____ months. And file with the Ministry of Foreign Trade and Economic Cooperation of the People's Republic of China, and then apply for change registration with the Administration for Industry and Commerce.

Chapter V Board of Directors

14. The date on which the joint venture receives the business license is the date on which the board of directors of the joint venture is established. The number of board members is _____, of which _____ is for Party A and _____ is for Party B. The directors are appointed and exchanged by both parties, and the chairman is appointed by Party A. Two vice-chairmen, one of whom is appointed by Party A and one of whom is appointed by Party B.

15. The board of directors is the highest authority of the joint venture. Its powers stipulate in the articles of association of the joint venture that the chairman of the board is the legal representative of the joint venture. When the chairman is unable to perform his duties, he shall authorize the vice chairman or other directors to represent the joint venture.

16. The board meeting is held at least once a year and is convened and presided over by the chairman. The board meeting shall be held by _____ of the above _____ directors. When a director is unable to attend, he may issue a power of attorney and entrust others to attend and vote on his behalf. The resolution of the board of directors shall be approved by the attending director or his representative. Board meetings are generally held at the legal address of the joint venture or at other locations agreed by the board of directors. The joint venture does not cover the travel expenses of attending the board meeting. Accommodation during the board meeting is arranged and paid for by the joint venture.

17. Directors do not pay salaries from joint ventures, and their remuneration will draw a certain percentage of the joint venture's full-year net profit as a dividend for the board of directors. And distributed according to the following proportions:

Chairman _____%
Vice Chairman of each _____%
Directors each _____%

Chapter VI General Manager Deputy General Manager

18. The joint venture has one general manager and three deputy general managers, all of whom are nominated by Party A and appointed by the board of directors. They are responsible for implementing the resolutions of the board meeting and organizing and leading the daily operation and management of the joint venture. Within the scope of the authorization of the board of directors, the general manager represents the joint venture. Responsible for subordinates, and exercise other powers conferred by the board of directors.

19. The important files of the joint venture will be effective after being signed by the general manager.

20. If the general manager or deputy general manager fails to perform his duties properly, the board of directors has the right to dismiss or demote.

Chapter VII Site Usage Fee

21. The land used by the joint venture is the assets of the Chinese government. The joint venture must deliver the appropriate land use fee to the government. The agreement on the lease of land used by the joint venture and the local land authority shall be an integral part of this contract.

22. The land use fee for the first _____ years is set at RMB _____ per square meter per year. Thereafter, the land use fee can be adjusted according to the development of the municipal construction.

Chapter VIII Technical Cooperation

23. The technology transfer agreement signed between the joint venture and _____ is an integral part of this contract and is valid for the same period as this contract.

24. According to the technology transfer agreement, the joint venture shall pay the technology transfer fee of _____ dollars to _____, and the method of payment of technology transfer and technology transfer fee shall be separately stipulated in the technology transfer agreement.

Chapter IX Purchasing and Sales

25. The purchase and sale agreement signed between the joint venture and Party B is an integral part of this contract and is valid for the same period as this contract.

26. The raw materials required for the joint venture should be purchased first in China. When the varieties or quality that cannot be supplied and the price do not meet the requirements of the joint venture, the joint venture may import from abroad.

27. According to the procurement and sales agreement signed by both parties, the products sold by the joint venture in China are sold by Party A through its sales department. The export products of the joint venture shall be sold by Party B in China, and the specific measures shall be separately stipulated in the procurement and sales agreement.

Chapter 10 Profits

28. All profits earned by the joint venture shall be withdrawn according to the following percentages in accordance with the Income Tax Law of the People's Republic of China on Sino-Foreign Equity Joint Ventures: _____% of the reserve fund; _____% of the enterprise development fund; _____% of the employee incentive and welfare fund.

The net profit after tax payment and the withdrawal of the above three funds is distributed annually according to the proportion of the capital contribution of the joint venture parties.

29. For the profit distributed by Party B, according to the foreign exchange balance of the joint venture, under the principle of not affecting normal production, this profit may be paid once or several times according to the decision of the board of directors. No profit may be distributed before the loss of the previous year is not compensated. Undistributed profits from previous years can be incorporated into the profit distribution for the current year.

Chapter 11 Financial Accounting

30. The joint venture shall implement the financial accounting regulations of the Chinese and foreign joint ventures of the People's Republic of China and must establish a complete and strict financial system.

31. All the documents, account books and statements of the joint venture are recorded in Chinese, and the financial statements are prepared regularly in English. The accountant registered in China by the board of directors of the joint venture has the right to inspect all the documents, books and statements of the joint venture and report directly to the board of directors.

32. The joint venture uses RMB as the unit of account, and the conversion between RMB and other currencies is settled at the same time as the exchange rate of the _____ branch of the State Administration of Foreign Exchange of the People's Republic of China.

33. The fixed assets of the joint venture shall be determined by the board of directors according to the “Detailed Rules for the Implementation of the Income Tax Law of the Chinese-Foreign Joint Venture Enterprise of the People's Republic of China”.

34. The joint venture shall open separate foreign exchange accounts and RMB accounts at the Bank of China _____ branch, and accept the supervision of the foreign exchange expenses of the depositary bank.

35. When the joint venture encounters insufficient liquidity in the course of operation, the general manager may borrow from the Bank of China or a foreign bank in accordance with the permission granted by the board of directors, but may not transfer it for use or make up for losses.

36. The fiscal year of the joint venture begins on January 1 and ends on December 31 of each year.

Chapter Twelve Foreign Exchange Income and Expenditure

37. All foreign exchange matters of the joint venture must be handled in accordance with the Provisional Regulations on Foreign Exchange Administration of the People's Republic of China and relevant administrative measures.

38. The foreign exchange receipts and payments of the joint venture must be:

Ensure that the annual foreign exchange income of the joint venture is greater than the expenditure.
When foreign exchange settlement of RMB, it shall be handled in accordance with the price specified at that time.
The joint venture shall pay fees, payment, labor remuneration, etc. within the territory of China, except for those who pay foreign exchange in accordance with relevant regulations.

39. According to the provisions of the Joint Venture Law, the following foreign exchange can be remitted:

Party B's profit and technology transfer fee.
The funds obtained after the transfer of Party B's capital.
The funds shall be paid to Party B before the contract expires or before the contract expires.
Foreign exchange required for the import of raw materials, equipment, spare parts, and travel expenses for foreign personnel.
Other expenses that can be remitted according to relevant regulations.

Chapter XIII Taxation

40. The joint venture shall pay various taxes in accordance with the relevant laws and regulations of China.

41. The employees of the joint venture shall pay personal income tax in accordance with the "Personal Income Tax Law of the People's Republic of China".

Chapter 14 Staff Recruitment and Dismissal

42. For the employees required by the joint venture, Party A or the Chinese labor management department shall adopt the open recruitment method and sign the labor contract after the examination is selected.

43. If the employees do have surplus due to changes in production technology, or if they are unable to adapt to the requirements after training, and cannot change other types of work, the joint venture may be dismissed and compensated according to the labor contract.

44. The joint venture shall formulate rules and regulations and staff codes, and separately warn, record, and deduct the violators until they are dismissed.

Chapter 15 Salary Standards and Awards

45. The wages of employees of joint ventures are currently calculated at the average monthly salary of _____ yuan, including the joint ventures paying various insurance premiums, subsidies and welfare measures for the employees of the state to the designated department of the Chinese government. With the development of joint venture production, the wages of employees should be gradually increased. In the future, when the Chinese government has new regulations on wages, benefits, subsidies, etc., the joint ventures should adjust accordingly.

46. _____ Party senior staff salary, social insurance, travel expenses standards refer to the _____ country or local standards, approved by the board of directors. In principle, the _____ party senior staff is equal to the _____ party senior staff.

47. According to the business results of the joint venture, a certain number of funds are proposed from the awards and welfare funds at the end of the year, and the awards are given to the employees who work well. The board of directors decides to give special rewards for those who have special contributions in technology, production or management.

Chapter 16 Joint Venture Term

48. The parties to the joint venture agree that the term of the joint venture is _____ years. From the date of issuance of the business license, one year before the expiration of the business, the other party agrees that it can be extended, the extension period is decided by both parties, and the approval process is submitted to the original examination and approval authority six months before the expiration.

49. The contract can be terminated early in any of the following situations:

After an appropriate start period, the joint venture cannot continue to operate due to a serious loss;
The failure of a party to perform its obligations under the contract or the charter prevents the joint venture from continuing to operate;
Due to force majeure events, such as serious natural disasters or wars, the joint venture is unable to continue to operate;
Failure to achieve the desired goals and failure to see the prospects for development.

Early termination of the contract must be decided by the special meeting of the board of directors and submitted to the original approval authority for approval.

50. When the contract expires or terminates early, the board of directors shall form a liquidation team to clean up. The board of directors can only be dissolved after the liquidation is completed. The liquidation method shall be handled in accordance with the liquidation procedures and procedures stipulated in Articles 103-105 of the Implementation Regulations of the Joint Venture Law. At the same time, the board of directors shall go through the formalities for cancellation with the original examination and approval authority and the administration for industry and commerce, and return the business license. The property that should be returned to the parties after liquidation must be calculated in accordance with the proportion of investment by the parties in the joint venture.

Chapter 17 Other matters

51. The parties to the joint venture perform the following matters:

_____square:

Responsible for applying for approval from the government and registering with the Administration for Industry and Commerce.
Responsible for handing over the factory and rented space to the joint venture.
Responsible for recruiting staff and staff.
Responsible for the domestic transportation of products and raw materials of joint ventures.
Responsible for ensuring the provision of water, electricity, gas, fuel, telephone, telegraph registration and telex.
Responsible for handling the visas of Party B personnel and their office, transportation, production and other arrangements.
Responsible for applying for a permit from the local environmental health management department.

_____square:

Responsible for providing all the necessary machinery and equipment on schedule. Foreign transportation of instruments, raw materials, technical materials and archives, raw materials and products.
Responsible for providing plant planning, and responsible for comprehensive technical guidance for equipment installation, commissioning, and trial production.
Responsible for technical training for employees in accordance with the needs of production.
Responsible for providing technical information on reports on sales trends of joint venture products in foreign markets.
In accordance with the Technology Transfer Agreement signed by the two parties, the technology and design shall be provided. If there is any dispute concerning the infringement of the rights of third parties, the transferor who signed the agreement shall be responsible for it, and the _____ party will not share any legal responsibility.
Responsible for the arrangement of _____ party personnel to _____ domestic study and training.

Chapter 18 Arbitration

52. If the parties to the joint venture have disputed the interpretation or performance of this contract and its subsidiary files, they shall first consult in the spirit of mutual trust, equality and mutual benefit in the board of directors and seek solutions. If it cannot be resolved, you can invite a third party agreed by both parties to mediate.

53. If the mediation fails, it will apply for arbitration. The arbitration was conducted by the China Council for the Promotion of International Trade's Foreign Economic and Trade Arbitration Commission. According to the "External Rules for Arbitration Procedures of the Foreign Trade Arbitration Commission". The expenses shall be borne by the losing party; the arbitral institution's ruling shall be final and binding on all parties.

54. During the settlement of the dispute. In addition to the disputed matters, the parties to the joint venture shall continue to perform the other provisions stipulated in the joint venture contract and the articles of association.

Chapter 19 Contract Text

55. Modification of this contract and subsidiary agreements. It must be agreed by the board of directors, signed by the authorized representatives of the parties, and reported to the original approval authority for approval.

56. This contract is written in both Chinese and English and is an official text. Equivalent. All subsidiary files of this contract are inseparable parts of this contract.

Chapter 20 Legal Address, File Notice

57. Legal address of the parties to the joint venture:
Party A: _____
Party B: _____

58. The means for the parties to the joint venture to transmit notices, such as the use of telegrams and telex notices, where the rights and obligations of the parties are involved, shall be notified in writing.

The legal address of the parties to the contract is the address of the parties.

59. This contract is signed in China by the authorized representatives of both Party A and Party B on ___ year ___ month ___.