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Corporate Service - China

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Q&A Regarding New Company Law of 2024 (8)

Answer
Q:
What is the registered capital of a limited liability company?
A:
The registered capital of a limited liability company is the amount of capital contributions subscribed by all shareholders registered with the company registration authority.

Q:
How long do shareholders need to pay in full the amount of capital subscribed of them?
A:
The amount of capital contribution subscribed by all shareholders shall be paid in full by the shareholders within five years from the date of establishment of the company in accordance with the provisions of the articles of association.

Q:
What is the minimum amount of registered capital for a limited liability company?
A:
The Company Law does not clearly stipulate the minimum amount of registered capital of a limited liability company. Where there are other provisions in laws, administrative regulations and decisions of The State Council regarding the paid in of the registered capital, the minimum amount of registered capital and the time limit for shareholders' contribution of a limited liability company, such provisions shall prevail.

Q:
What are the ways of shareholders' capital contribution?
A: Shareholders may make capital contribution in currency or with non-monetary property such as physical objects, intellectual property rights, land use rights, equity rights and creditor's rights that can be valued in currency and transferred according to law; However, the exception shall be the property which shall not be used as capital contribution as stipulated by laws and administrative regulations.

Q:
How do shareholders pay their subscribed capital contributions?
A: Where the shareholders makes capital contribution in currency, they shall deposit the full amount of their capital contribution in a bank account opened by the limited liability company; Where capital contribution is made with non-monetary property, the formalities for the transfer of property rights shall be handled in accordance with law.

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