China Regulatory Brief: Tax Registration Certificate to be Abolished, Updated Chinese Advertising Law

September 21, 2015 Posted by China Briefing Reading Time: 4 minutes

China to Abolish Tax Registration Certificate Starting October 1

On September 10, the State Administration of Taxation (SAT) officially announced that companies newly established after October 1, 2015 will no longer be required to obtain the tax registration certificate when conducting business registration procedures. Instead, newly established companies will be issued a special business license with a unified social credit code on it. The special business license can be used as the previous tax registration license when the company is dealing with tax relevant issues.

New Chinese Advertising Law Comes into Effect

The Chinese Government has recently released the country’s updated 2015 Advertising Law, which took effect on September 1 and puts an emphasis on social order, safety and the interests of minors. Notable clauses in the April update concern the clarity and transparency of information and language employed in advertisements.

According to the Law, an advertisement shall not utilize words such as “State level,” “highest level” or “the best,” regulating unmeasurable grading or a company’s untruthful claims of a product’s efficacy or safety. Another amendment occurs in the article regarding the clarity of real estate advertisement, stating that no advertisement should include information such as promise of investment or appreciation returns, location of housing projects by travel time between a property and specific amenities or landmarks, or misleading publicity of transport, commercial, cultural or educational facilities, which are in the planning or construction stage, or other municipal services.

Beijing to Open up its Service Industry to Foreign Investors

On September 16, the Beijing Municipal Government released its “Scheme on Expending and Opening up of Service Sector to Foreign Investors,” which covers six service sectors including IT services, education and entertainment, financial services and healthcare services. The Scheme lowers the entry barriers for foreign investors in Beijing’s service sector, allowing foreign-invested intermediary service institutions to engage in tax, accounting, law, consulting, appraisal and market investigation, etc. Foreign investors will also be permitted to set up credit standing investigation companies in Beijing. Hong Kong and Macau professionals that have obtained the Chinese certified public accountant qualification may be the partners of the partnership accountant firms in Beijing.

**E-commerce Platforms Required to Set up Offline 7*8 Hours Service Hotline**

On September 16, China’s Ministry of Commerce (MOFCOM) released the draft rules for third-party online trading platforms, which is currently seeking public opinions. The Draft clarifies that for paid services, the e-commerce platforms shall keep the retailers/vendors informed of the service items and details of the service fees and shall not adjust the fee criteria within the specified service period. Further, e-commerce platforms need to set up an offline 7*8 hours service hotline for their vendors. More information about China’s leading e-commerce platforms and business opportunities for online business can be found in our previous article here.

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