What are the types of enterprises in China?

Company types are divided into the following categories.

1. Limited liability company: an economic organization established with capital contribution of less than 50 shareholders. Each shareholder shall bear limited liability to the company with the amount of capital contribution subscribed, and the company as a legal person shall bear full liability for the company's debts with all its assets.

Applicability: Most investment and financing schemes and VIE structures are designed based on limited liability companies.

Remarks: For start-ups, "limited liability company" is the appropriate enterprise type at present for the following reasons:

(1) The shareholders of a limited liability company only need to bear "limited liability" within the limit of their capital contribution, and legally divide the property of the company and individuals, which can avoid entrepreneurs from taking unnecessary financial risks.

(2) Limited liability companies have low operating costs, few institutional settings and simple structure, which are suitable for the initial development stage of enterprises.

(3) At present, almost all mature Angel and VC design investment schemes based on "limited liability companies". Directly registering a "limited liability company" will make the process of introducing investment smoother in the future.

2. Joint stock limited company: It consists of more than 2 promoters and less than 200 promoters. All the capital of the company is equal shares, and shareholders are liable to the company to the extent of their shares.

Application: Suitable for mature and large-scale companies, with strict and complicated establishment procedures, not suitable for start-ups and small and medium-sized enterprises.

3. Limited partnership: composed of general partners and limited partners. The general partner shall be jointly and severally liable for the debts of the partnership, and the limited partner shall be limited to the subscribed capital contribution.

Application: Suitable for venture capital fund and company equity incentive platform (employee stock ownership platform).

4. Wholly foreign-funded companies: foreign companies, enterprises, other economic organizations or individuals, and enterprises established in China with all their capital invested by foreign investors according to the laws of China.

Application: Enterprises whose shareholders are foreigners or foreign companies have more complicated processes and stricter supervision than domestic companies. Consistent with a nominal limited liability company. .

5. Wholly-owned enterprise: an enterprise invested and operated by an individual, owned and controlled by an individual, which bears operational risks and enjoys all operational benefits. Investors shall bear unlimited liability for the debts of the company with their personal property.

Applicability: Suitable for small workshops and restaurants. , common in enterprises with special requirements for names.

6. Wholly state-owned company: refers to a limited liability company solely funded by the state and authorized by the State Council or local people-enterprises-Qunar-government to perform the responsibilities of the investor.

7. Others: unincorporated enterprises: legal persons and other economic organizations with investment qualifications.

Foreign-funded enterprises: foreign parties are companies, legal persons, other economic organizations and natural persons, while Chinese parties are companies, legal persons and other economic organizations.