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China Company Chops Overview

Updated:2018-10-8 16:18:47    Source:www.tannet-group.comViews:77

China company chops is of great importance, since every contract with a Chinese company must be executed by a person at the Chinese company with authority and it must be chopped with the official company chop (sometimes also referred to as a company seal). However, there are many types of company chops. Which one should be used? What are difference between each of them? The requirements for China company chops may vary in each city. Tannet has branches in the major cities like Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Dongguan, Nanchang, Chengdu, Yiwu, Quanzhou, Xiamen, Hainan and Xinjiang Horgos. We can help you set up businesses and assist in the operation.

Introduction to China Company Chop
A company chop, commonly referred to as the official company seal, is a legally binding mark that plays the same role in the Chinese market that the signature of a high ranking official plays in the Western market. The chop of the company can be considered to be a company’s official signature. A little known fact about chops is that they’re not a novelty but a necessity when it comes to doing business in China.

Simply put, the use of the company’s chop makes an otherwise null and void document legally binding. Based on the nature of your business and the industry that you operate in, your business may have just one chop or multiple chops, and each for different purposes.

Requirements on Company Chop
If you want to make your company chop legally binding, you must satisfy a small list of requirements. For Wholly Foreign Operated Enterprises (WFOEs) in China, the company’s chop must be:

1. Registered with the Administration of Industry and Commerce (AIC);
2. Approved by the Public Security Bureau (PSB);
3. Recorded by the bank of the WFOE in question.

Different Types of Chops in China
There are different types of chops in China. Let’s take WFOE as an example.
1. Finance Chop
As the name suggest, this chop is a legal requirement for all matters pertaining to the WFOE’s finances. Whether it’s something as trivial as opening a bank account for a new recruit or something as complicated as authenticating time-sensitive financial records, your WFOE will need an official Finance Chop to go through the relevant channels.

In the absence of an official Finance Chop, the Company Chop can be used in its place although we strongly advice against this practice.

2. Customs Chop
The Customs Chop is a legal requirement for all matters pertaining to the company’s custom declarations. From import to export and everything in between, if you want your consignments to be cleared by the Custom’s Office, your WFOE will need an official (and registered) Customs Chop.

3. Contract Chop
When it comes to recruiting new employees and recording their time of employment (for tax purposes), your WFOE requires a Contract Chop. Simply put, this seal legally binds the employee and the employer to the terms mentioned on the contract.

Unlike the Finance Chop, the Contract Chop is not a necessity as your WFOE can just use the official Company Chop in its stead.

4. Invoice Chop
Sometimes called the fapio chop, the Invoice Chop is a legal requirement that is mandatory if your WFOE wants to issue official invoices. Simply put, if you want to officially declare a recent procurement as a business expense, your WFOE will need an official Invoice Chop.

5. Legal Representative Chop
As the name suggests, the Legal Representative Chop is a personal chop that is in the possession of your legal advisors and counsel.

As the Chinese market permits the principal Legal Representative to enter legally binding contract agreements on behalf of the company he represents, the Legal Representative Chop is an essentially important signature that must be recorded with the PSB, the AIC, and the bank of your WFOE.

Contact Us
If you have further inquires, please do not hesitate to contact Tannet at anytime, anywhere by simply visiting Tannet’s website www.tannet-group.net, or calling Hong Kong hotline at 852-27826888 or China hotline at 86-755-82143422, or emailing to tannet-solution@hotmail.com. You are also welcome to visit our office situated in 16/F, Taiyangdao Bldg 2020, Dongmen Rd South, Luohu, Shenzhen, China.

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