Hainan is the youngest province of China, which was established in 1988 and was separated from Guangdong (Conton) province. The central government has implemented favorite investment policies in the economic development in Hainan since the beginning of the establishment of the province. In the tenth anniversary of the establishment of the province, the central government of China launched the new plans to improve the economic development in Hainan, which focuses on developing international tourism industry in Hainan. By the new policies, a foreign visitor coming from more than 20 countries does not need a visa to enter into the Island of Hainan. So, it is very easy for a foreigner to do business or take a vocation in Hainan
Why Invest in Hainan?
Some people said that the Hainan Island is the best invest place in China.
Located on the same latitude as Hawaii; with its warm climate, beautiful scenes and extremely rich natural resources
million square kilometers sea area, Hainan Island has many exceptional attractions.
In additional, Hainan is the largest and the most special economic area among the 5 "Special Economic Areas" in China.
Special Invest Policies
What are the special economic policies of the Hainan Province?
(1) Hainan Province possess the power to establish local new laws. The Province Government has more power on its own economic administration.
(2) To import the equipment, materials, fuels and tracks for the construction or production on the Hainan Island are tax-free. The tourism industry self-using foods and certain office items are tax-free too.
Also the companies can import production material for self-selling with a reduced tax.
(3) All the export products that were produced by the import materials are tax-free.
When the export products were produced by the Chinese materials, but the products' value-added >25%, most of these products are tax-free (Except a few products that were excluded by the State policy)
(4) Tax favoured policy for the companies.
The business income-tax is 15%.
The companies in the development of the ports, wharves, motorways, electronic power station, mines, water system and agriculture; with a business period over 15 years. - Income-tax free for the 1-5 years, half income-tax for the 6-10 years.
The companies of industry and transport , with a business period over 10 years - Income -tax free for the 1-2 years, half income-tax for the 3-5 years. (For those companies that have been recognized by the Province Government as the "technology" enterprises, their 5-8 years' income-tax are also reduced to a half.
The companies in the service business with a period over 10 year and the investment over US Dollar $6 million or RMB 20 million Yuan. - The first year is income-tax free, the 2nd year income-tax reduces to half.
(5) Favoured international trade policy. All the registered companies in the Hainan Province, with its annual export over US Dollar $1.5million, can apply for the Import/Export license. The range of import/export products can be wider than general.
(6) Favoured financial policy. With the permission of Chinese People Bank, it is allowed to establish the foreigner bank, joint venture bank or other financial institution in the Hainan Province.
The Hainan Province is allowed to get the investment capital from foreigner countries directly for the development of its economy.
(7) Favoured tourism and diplomat policies. The Hainan Province is allowed to connect with the foreigner tourism agencies and informing the visa situation.
It can give the permission for the foreigner company to establish their tourism business in the province; also to permit Chinese companies set up their trade offices or tourism offices in the foreigner countries
When the foreigners, Oversea Chinese, Hong Kong, Macao and Taiwan people come to Hainan for business, tourism or to visit their relatives, in a period less than 15 days; Hainan Government has the power to sign the instant visa for them.
(8) Investors is allowed to rent land in the Hainan Province, The longest rent period is 70 years.
The investors may rent the land through the agreement or through the auction etc. It is allowed to pay the rent fee at once or divided into several times. Foreigner investors or joint venture are allowed to establish their companies to explore the land (Including State agriculture enterprises)
(9) Protect the interests and rights of the foreigner investors.
Welcome the foreigner companies invest on the development of port, wharf, motorway, stores, electronic power, postal communication, aircraft, sea transport etc basic construction projects.
Allow the foreigner companies to invest on commercial retail business with the export trade.
Encouraging the foreigner companies to do finance, insurance, consultant, lawyer, counter, estate business, as well as to run travel agency, to build hospitals and schools.
The Government protects the independence of the foreigner investors' business and their interest and right according the law.
(10) Ensuring the business here have the right to do their own independent management , including invest decision, production and marketing plans, products' prices, company administration structure, employ staff etc.
(11) Testing the new areas - " Export Production Area" and "Free Trade Area".
In these areas, the foreigner companies are allowed to open the foreigner capital bank, to use foreigner currency to do buy-and-sell and transaction. to do international trade and transfer trade here. To export/import goods without limitation and permission.
There are three principal business models for foreign companies seeking to establish themselves in China : Joint Ventures, Wholly Foreign-Owned Companies, and Representative Offices (ROs)
Foreign investors can now determine an organizational structure according to the operations of their enterprises at their own discretion. Such potential investors should approach the appropriate government departments for a better understanding of the legal procedures involved in setting up a business in China.
One-stop services for investing in Hainan
Since 2006, Tommy China Business Consulting has been focusing on consulting services for our clients to invest in Hainan. We are specialized in establishment of wholly foreign owned enterprises (WFOEs), setting up of offshore companies, trading services, tax minimization Assist in obtaining government approvals and certificates for running business, negotiate and draft various legal documents provide legal advice, negotiate government officer for Land acquisition
Advising on formation of WOFE and business structures ,managing and controlling WOFE in China drafting privacy policies and structuring commercial transactions
TCBC will manage all aspects of incorporation to get you a business license in Hainan China. We offer a range of company formation services including helping you to set up:
-Wholly Foreign Owned Enterprises (WFOE )
-Joint Ventures (Equity/Co-operative)
setting up a business in China involves a lot of paperwork. This tedious process can be tided over by approaching one of the many firms that provide the relevant services. Nevertheless, before making any investment decisions, investors should be well acquainted with the related regulatory issues. While investors may choose to let the agencies or consulting firms take care of the decision-making processes, it is advisable for them to understand the procedures themselves.
Tommy China Business Consulting
Unit 7034, 7 floor , XinHua Building East Block.
No 2018, ShenNan Avenue, FuTian District
ShenZhen, China. Post code:518053
Tel: 86-755-25809219, Fax: 86-755-83256658