5.2TheexistingFIEforms:EJV,CJVandWFOEEJVCJVWFOE
5.2 The existing FIE forms: EJV , CJV and WFOE EJV CJV WFOE
ChineseForeign EquityJoint Ventures-EJV中外合资企业。TheEJVisthe jointventure betweenChinese andforeignventures whereprofits and losses are distributedbetween them inproportiontotheirrespectiveequityinterests.Theforeignventuresholdmorethan25%equityinterestintheregisteredcapitaloftheEJV.IttakesformofLLCandisaChinese enterprise legal person.The EJV contract and articles of associationarerequired.Relatedlawsandregulations(repealedbythenewFlLin2020):LawofthePeople'sRepublicofChinaonChinese-ForeignJointVenturesDetailedRulesforLawofthePeople'sRepublicofChinaonChinese-ForeignJointVentures
Chinese Foreign Equity Joint Ventures –EJV 中外合资企业 ◦ The EJV is the joint venture between Chinese and foreign ventures where profits and losses are distributed between them in proportion to their respective equity interests. The foreign ventures hold more than 25% equity interest in the registered capital of the EJV. It takes form of LLC and is a Chinese enterprise legal person. The EJV contract and articles of association are required . Related laws and regulations(repealed by the new FIL in 2020): ◦ Law of the People's Republic of China on Chinese-Foreign Joint Ventures ◦ Detailed Rules for Law of the People's Republic of China on Chinese-Foreign Joint Ventures
上海大众汽车Eg:SHANGHAI VOLKSWAGENVolkswagenDos Auto.一汽-大众FAW-VOLKSWAGENHonda广汽HONDAHONDAThePowerofDreams
Eg: Volkswagen Honda
Example:VOLKSWAGENSAICVOLKSWAGENAUTOMOTIVECO.LTD.(SAICVOLKSWAGENforshort)isaChinese-GermanjointventurefoundedbySAiCMotorandVolkswagenGroupinOctober1984.Thecompanyisoneofthemosttime-honoredautomobilejointventuresinChina.。SAICMOTORcontributed50%andGermanVolkswagen50%andthecontractwas254years.In2002,thetwoinvestorsextended47790thecontracttermto2030.https://www.bilibili.com/video/BV1zJ411A7i4/?spmidfrom=333.337.search-card.all.click
Example: VOLKSWAGEN ◦ SAIC VOLKSWAGEN AUTOMOTIVE CO., LTD. (SAIC VOLKSWAGEN for short) is a Chinese-German joint venture founded by SAIC Motor and Volkswagen Group in October 1984. The company is one of the most time-honored automobile joint ventures in China. ◦ SAICMOTOR contributed 50% and German Volkswagen 50% and the contract was 25 years. In 2002, the two investors extended the contract term to 2030. ◦ https://www.bilibili.com/video/BV1zJ411A7j4/ ?spm_id_from=333.337.search-card.all.click
TheVolkswagenSantana'sbiggestsuccesswasinChina.SAiCVolkswagen'sShanghaiplantwasbythefarthewinneramongalnewJVs,asitproducedcarsthatcouldfunctionastaxis,vehiclesforgovernmentW-SANTANofficials andtransportforthenewly emergingbusinesselite.SAiCVolkswagenbeganautomobileproductionin1985(Thefirstassemblyline)Ascarimportsfelltosome34,000in1990SAlCVolkswagen'sproductionofits Santana models reachednearly19,000vehiclesthatyear
◦ The Volkswagen Santana's biggest success was in China. SAIC Volkswagen‘s Shanghai plant was by the far the winner among all new JVs, as it produced cars that could function as taxis, vehicles for government officials and transport for the newly emerging business elite. ◦ SAIC Volkswagen began automobile production in 1985(The first assembly line). As car imports fell to some 34,000 in 1990, SAIC Volkswagen’s production of its Santana models reached nearly 19,000 vehicles that year