Sino-foreign joint venture contract (4)

Chinese and foreign industrial contract reference format
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) Site usage fee
8) Technical cooperation
9) Procurement and sales
10) Profit
11) Financial accounting
12) Foreign exchange receipts and payments
13) Taxation
14) Employee recruitment and dismissal
15) Salary standards and rewards
16) Joint venture period
17) Other matters
18) Arbitration
19) Contract text
20) Legal address, file notice

××××, ×××× and ××××,××××,××××, in accordance with the provisions of the Law of the People’s Republic of China on Sino-Foreign Equity Joint Ventures and its Implementation Regulations, in accordance with the principle of equality and mutual benefit, Established a joint venture in the XX City of the People's Republic of China. Engaged in the production of reflectors, injection molds and other plastic products for export and sales in the People's Republic of China. After many discussions, unanimously agreed to enter into this contract.

Chapter I General Provisions

1. The parties to this contract are:

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

××××,××××,×××× is one party, and XX is represented by Party B and is responsible for this contract.

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

2. The joint venture established by both parties is named: ××××

Chinese: ××××
English: ××××
Address: ××××

3. In accordance with the principle of equality and mutual benefit, the two sides are engaged 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: an annual output of × × sets of × × × reflectors in accordance with the standard of × × × ×, accepting orders to produce injection molds with an annual output value of × × × yuan. Party B is responsible for the return of the XX reflector, ensuring that the foreign exchange income and expenditure of the joint venture will reach its own balance in the first year after the production. And × the proportion of sales after the year is not less than XX%, Party B is responsible for the joint venture enterprise to undertake orders for injection molds of not less than XX 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 and rules of the People's Republic of China and be governed and protected by the laws of the People's Republic of China.

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 XX USD. The total registered capital is XX US dollars, of which Party A occupies XX% of the capital amount, and Party B occupies XX% of the capital amount.

8. Party A and Party B contribute as follows:

Party A: × × US dollars, of which:

1. Machine equipment, worth about XX dollars;
2. Plant, valued at approximately × × US dollars;
3. Cash, equivalent to XX yuan in renminbi cash.

Party B: × × USD foreign exchange cash.

Chapter III Approval and Registration

9. This contract shall be approved by the XX City and shall take effect from 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 in installments according to the progress of the project. The amount of each party to pay shall be determined 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 the place without the consent of the joint venturer. However, when a party proposes an assignment, 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 Party A is a person and Party B is a person. The directors are appointed and exchanged by the two 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 a director of more than ××. 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, each x%
Directors each ×%

Chapter VI 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 × year is set at RMB × × yuan 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 ××××, as an integral part of this contract, is valid for the same period as this contract.

24. The joint venture is based on a technology transfer agreement. The technology transfer fee is paid to ×××××× US dollars. The method of payment of technology transfer and technology transfer fees shall be separately specified in the technology transfer agreement.

Chapter IX Purchasing and Sales

25. The purchase and sale agreement between the joint venture and 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. If the variety or quality that cannot be supplied or the price does not meet the requirements of the joint venture, the joint venture may import it from abroad.

27. According to the procurement and sales agreement signed by both parties, Party A is responsible for sales through its sales department for products sold by the joint venture in China. 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 Profit

28. All the profits obtained by the joint venture shall be withdrawn according to the following percentages according to the Income Tax Law of the People's Republic of China on Sino-Foreign Equity Joint Ventures: Reserve Fund × ×%; Enterprise Development Fund × ×%; Staff Award 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. The undistributed profits of the previous year can be incorporated into the profit distribution of 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 accounting 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 takes the people 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 RMB exchange bureau 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 a foreign exchange account and a RMB account at the Bank of China ×× branch, and accept the supervision of the foreign exchange expenditure by 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 13 Taxation

40. The taxes paid by the joint venture 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 XIV 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 employee rules, 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 on the basis of the average monthly salary of × × yuan, including the joint ventures to the Chinese government designated departments to pay various insurance premiums, subsidies and welfare measures for the employees. 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 venture should make corresponding adjustments accordingly.

46. The standard for the salary of the senior staff, social insurance, and travel expenses shall be determined by the board of directors with reference to the national or local standards of the parties. In principle, the senior staff of the party will receive equal pay for equal work with the senior staff of the X-party.

47. According to the business results of the joint venture, a certain number of funds will be proposed from the awards and welfare funds at the end of the year, and the awards will be 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 XX 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 through negotiation, and the approval process is submitted to the 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-up 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 formalities 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 of going out to 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:

×方:

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 and living arrangements.
Responsible for applying for a permit from the local environmental health management department.

×方:

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 reports and technical information on sales trends in foreign markets for joint venture products.
In accordance with the Technology Transfer Agreement signed by both 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, and X will not share any legal responsibility.
Responsible for the arrangements for the study and training of the X-party personnel to the X-party.

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 authorized representatives of both Party A and Party B on the date of ××××year×month×day.