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1、THE CONTRACT FOR SINO-FOREIGN EQUITY JOINT VENTUREWhole Doc.Chapter 1 General ProvisionsIn accordance with the Law of the Peoples Republic of China on JointVentures Using Chinese and Foreign Investment (the Joint Venture Law)and other relevant Chinese laws and regulations, _Company and_ Company, in

2、accordance with the principle of equality andmutual benefit and through friendly consultations, agree to jointly investto set up a joint venture enterprise in _of the Peoples Republicof China.Chapter 2 Parties of the Joint VentureArticle 1Parties to this contract are as follows: _Company (hereinafte

3、r referred to as Party A), registered with _ in China,and its legal address is at _; _China.Legal representative: Nameosition:Nationality:_Company (hereinafter referred to as Party B), registeredwith _. Its legal address at _.Legal representative: Name osition:Nationality:;Note: In case there are mo

4、re than two investors, they will be calledParty C,D.in proper order).Chapter 3 Establishment of the Joint Venture CompanyArticle 2In accordance with the Joint Venture Law and other relevant Chineselaws and regulations, both parties of the joint venture agree to set up_joint venture limited liability

5、 company ( hereinafterreferred to as the joint venture company).Article 3The name of the joint venture company is _Limited LiabilityCompany.The name in foreign language is _.The legal address of the joint venture company is at _street_(city)_ province.Article 4All activities of the joint venture com

6、pany shall be governed by thelaws, decrees and pertinent rules and regulations of the Peoples Republicof China.Article 5The Organization form of the joint venture company is a limitedliability company. Each party to the joint venture company is liable tothe joint venture company within the limit of

7、the capital subscribed byit. The profits, risks and losses of the joint venture company shall beshared by the parties in proportion to their contributions to theregistered capital.Chapter 4 The Purpose, Scope and Scale of Production and BusinessArticle 6The goals of the parties to the joint venture

8、are to enhance economicco-operation technical exchanges, to improve the product quality, developnew products, and gain a competitive position in the world market inquality and price by adopting advanced and appropriate technology andscientific management methods, so as to raise economic results and

9、ensuresatisfactory economic benefits for each investor.(Note: This article shall be written according to the specificsituations in the contract).Article 7The productive and business scope of the joint venture company is toproduce _ products; provide maintenance service after the sale ofthe products;

10、 study and develop new products.(Note: It shall be written in the contract according to the specificconditions).Article 8The production scale of the joint venture company is as follows:1. The production capacity after the joint venture is put intooperation is _.2. The production scale may be increas

11、ed up to _ with thedevelopment of the production and operation. The product varieties may bedeveloped into _.(Note: It shall be written according to the specific situation).Chapter 5 Total Amount of Investment and the Registered CapitalArticle 9The total amount of investment of the joint venture com

12、pany is RMB_ (or a foreign currency agreed upon by both parties).Article 10Investment contributed by the parties is Renminbi _, whichwill be the registered capital of the joint venture company.Of which: Party A shall pay _ Yuan, accounting for_%; Party B shall pay _Yuan, accounting for_%.Article 11B

13、oth Party A and Party B will contribute the following as theirinvestmentarty A: cash _Yuanmachines and equipment _Yuanpremises _Yuanthe right to the use of the site _Yuanindustrial property _Yuanothers _ Yuan, _ Yuan in all.Party B: cash _Yuanmachines and equipment _Yuanindustrial property _Yuanothe

14、rs _Yuan, _Yuan in all.(Note: When contributing capital goods or industrial property asinvestment, Party A and Party B shall conclude a separate contract to be apart of this main contract).Article 12The registered capital of the joint venture company shall be paid in_ installments by Party A and Par

15、ty B according to theirrespective proportion of their investment.Each installment shall be as follows:(Note: it shall be written according to the concrete conditions).Article 13In case any party to the joint venture intends to assign all or partof his investment subscribed to a third party, consent

16、shall be obtainedfrom the other party to the joint venture, and approval from theexamination and approval authority is required.When one party to the joint venture assigns all or part of hisinvestment, the other party has preemptive right.Chapter 6 Responsibilities of Each Party to the Joint Venture

17、Article 14Party A and Party B shall be respectively responsible for thefollowing matters:Responsibilities of Party A:Handling of applications for approval, registration, business licenseand other matters concerning the establishment of the joint venturecompany from relevant departments in charge of

18、ChinaOrganizing the design and construction of the premises and otherengineering facilities of the joint venture companyAssisting Party B to process import customs declaration for themachinery and equipment contributed by Party B as investment and arrangingthe transportation within the Chinese terri

19、tory;Assisting the joint venture company in purchasing or leasingequipment, materials, raw materials, articles for office use, means oftransportation and communication facilities etc.;Assisting the joint venture company in contacting and settling thefundamental facilities such as water, electricity,

20、 transportation etc.;Assisting the joint venture in recruiting Chinese managementpersonnel, technical personnel, workers and other personnel needed;Assisting foreign workers and staff in applying for entry visas, worklicenses and handling their travel procedures;Responsible for handling other matter

21、s entrusted by the joint venturecompany.Responsibilities of Party B:Providing cash, machinery and equipment, industrial property . inaccordance with the provisions of Article 11, and responsible for shippingcapital goods such as machinery and equipment etc. contributed asinvestment to a Chinese port

22、;Handling the matters entrusted by the joint venture company, such asselecting and purchasing machinery and equipment outside China, etc.Training the technical personnel and workers of the joint venturecompany;In case Party B is the licensor, it shall be responsible for thestable production of quali

23、fied products of the joint venture company inthe light of design capacity within the specified period;Responsible for other matters entrusted by the joint venture company.(note: It shall be written according to the specific situation).Chapter 7 Transfer of TechnologyArticle 15Both Party A and Party

24、B agree that a technology transfer agreementshall be signed between the joint venture company and Party B (or a thirdparty) so as to obtain advanced production technology needed for realizingthe production and operation purpose and the production scale specified inChapter 4 of the contract, includin

25、g product design, manufacturingtechnology, means of testing, materials prescription, standard of qualityand the training of personnel etc.(Note: It shall be written in the contract according to the concreteconditions).Article 16Party B offers the following guarantees on the transfer of technology:(N

26、ote: Article applies only when Party B is responsible fortransferring technology to the joint venture company).1. Party B guarantees that the overall technology such as thedesigning, manufacturing technology, technological process, tests andinspection of products (Note: The name of the products shal

27、l be written)provided to the joint venture company must be integrated, precise andreliable. It is to meet the requirement of the joint ventures operationpurpose, and be able to obtain the standard of production quality andproduction capacity specified in the contract;2. Party B guarantees that the t

28、echnology specified in this contractand the technology transfer agreement shall be fully transferred to thejoint venture company, and pledges that the provided technology should betruly advanced among the same type of technology produced by Party B, themodel, specification and quality of the equipme

29、nt are excellent and it isto meet the requirement of technological operation and practical usage;3. Party B shall work out a detailed list of the provided technologyand technological service at various stages as specified in the technologytransfer agreement to be an appendix to the contract, and gua

30、rantee itsperformance;4. The drawings, technological conditions and other detailedinformation are part of the transferred technology and shall be providedon time;5. During the term of the technology transfer agreement, Party B shallprovide the joint venture company with any improvements in the techn

31、ologyand the improved information and technological materials in time, andshall not charge separate fees;6. Party B shall guarantee that the technical personnel and theworkers in the joint venture company can master all the technologytransferred within the period specified in the technology transfer

32、agreement.Article 17In case Party B fails to provide equipment and technology inaccordance with the provisions of this contract and the technologytransfer agreement or in case any deceiving or concealing actions arefound, Party B shall be responsible for compensating the direct losses tothe joint ve

33、nture company.Article 18The technology transfer fee shall be paid in royalties. The royaltyrate shall be _% of the net sales value of the products.The term for royalty payment is the same as the term for thetechnology transfer agreement specified in Article 19 of this contract.Article 19The term for

34、 the technology transfer agreement signed by the jointventure company and Party B is _ years. After the expiration ofthe technology transfer agreement, the joint venture company shall havethe right to use, research and develop the imported technologycontinuously.(Note: The term for a technology tran

35、sfer agreement is generally nolonger than 10 years, and it shall be approved by the Ministry of ForeignTrade and Economic Cooperation or other examination and approvalauthorities entrusted by the Ministry of Foreign Trade and EconomicCooperation).Chapter 8 Selling of ProductsArticle 20The products o

36、f joint venture company will be sold both on the Chineseand the overseas market, the export portion accounts for _%,_% for the domestic market.(Note: An annual percentage and amount for outside and domesticselling will be written out according to practical situations, in normalconditions, the amount

37、 for export shall at least meet the needs of foreignexchange expenses of the joint venture company).Article 21Products may be sold on overseas markets through the followingchannels:The joint venture company may directly sell its products on theinternational market, accounting for _%.The joint ventur

38、e company may sign sales contracts with Chineseforeign trade companies, entrusting them to be the sales agencies orexclusive sales agencies, accounting for _%.The joint venture company may entrust Party B to sell its products,accounting for _%.Article 22The joint ventures products to be sold in Chin

39、a may be handled by theChinese materials and commercial departments by means of agency orexclusive sales, or may be sold by the joint venture company directly.Article 23In order to provide maintenance service to the products sold both inChina or abroad, the joint venture company may set up sales bra

40、nches formaintenance service both in China or abroad subject to the approval of therelevant Chinese department.Article 24The trade mark of the joint ventures products is _.Chapter 9 The Board of DirectorsArticle 25The date of registration of the joint venture company shall be thedate of the establis

41、hment of the board of directors of the joint venturecompany.Article 26The board of directors is composed of _directors, of which_shall be appointed by Party A, _by Party B. Thechairman of the board shall be appointed by Party A, and its vice-chairmanby Party B. The term of office for the directors,

42、chairman andvice-chairman is four years, their term of office may be renewed ifcontinuously appointed by the relevant party.Article 27The highest authority of the joint venture company shall be its boardof directors. It shall decide all major issues (Note: The main contentsshall be listed in the lig

43、ht of Article 36 of the Implementing Regulationsfor the Joint Venture Law) concerning the joint venture company. Unanimousapproval shall be required for any decisions concerning major issues. Asfor other matters, approval by majority or a simple majority shall berequired.(Note: It shall be explicitl

44、y set out in the contract).Article 28The chairman of the board is the legal representative of the jointventure company. Should the chairman be unable to exercise hisresponsibilities for any reason, he shall authorize the vice- chairman orany other directors to represent the joint venture company tem

45、porarily.Article 29The board of directors shall convene at least one meeting every year.The meeting shall be called and presided over by the chairman of theboard. The chairman may convene an interim meeting based on a proposalmade by more than one third of the total number of directors. Minutes ofth

46、e meetings shall be placed on file.Chapter 10 Business Management OfficeArticle 30The joint venture company shall establish a management office whichshall be responsible for its daily management. The management office shallhave a general manager, appointed by Party _, _ deputy generalmanagers, _by P

47、arty _; _by Party _. The generalmanager and deputy general managers whose terms of office is _years shall be appointed by the board of directors.Article 31The responsibility of the general manager is to carry out thedecisions of the board and organize and conduct the daily management ofthe joint ven

48、ture company. The deputy general managers shall assist thegeneral manager in his work.Several department managers may be appointed by the management office,they shall be responsible for the work in various departmentsrespectively, handle the matters handed over by the general manager anddeputy gener

49、al managers and shall be responsible to them.Article 32In case of graft or serious dereliction of duty on the part of thegeneral manager and deputy general managers, the board of directors shallhave the power to dismiss them at any time.Chapter 11 Purchase of EquipmentArticle 33In its purchase of re

50、quired raw materials, fuel, parts, means oftransportation and articles for office use, etc., the joint venturecompany shall give first priority to purchase in China where conditionsare the same.Article 34In case the joint venture company entrusts Party B to purchaseequipment on the overseas market,

51、persons appointed by the Party A shallbe invited to take part in the purchasing.Chapter 12 Preparation and ConstructionArticle 35During the period of preparation and construction, a preparation andconstruction office shall be set up under the board of directors. Thepreparation and construction offic

52、e shall consist of _ persons,among which _ persons will be from Party A, _ persons fromParty B. The preparation and construction office shall have one managerrecommended by Party _, and one deputy manager by Party _.The manager and deputy manager shall be appointed by the board ofdirectors.Article 3

53、6The preparation and construction office is responsible for thefollowing concrete works: examining the designs of the project, signingthe project construction contract, organizing the purchase and inspectionof related equipment, materials, etc., working out the general schedule ofproject constructio

54、n, compiling the expenditure plans, controlling projectfinancial payments and final accounts of the project, drawing upmanagerial methods and keeping and filing documents, drawings, files andmaterials, etc., during the construction period of the project.Article 37A technical group with several techn

55、ical personnel appointed by PartyA and Party B shall be organized. The group, under the leadership of thepreparation and construction office, is in charge of the examination,supervision, inspection, testing, checking and accepting, and performancechecking of the project design, the quality of the pr

56、oject, the equipmentand materials and the imported technology.Article 38After approval by both parties, the establishment, remuneration andthe expenses of the staff of the preparation and construction office shallbe covered in the project budget.Article 39After having completed the project and finis

57、hed the turning overprocedures, the preparation and construction office shall be dissolvedupon the approval of the board of directors.Chapter 13 Labor ManagementArticle 40Labor contract covering the recruitment, employment, dismissal andresignation, wages, labor insurance, welfare, rewards, penaltie

58、s and othermatters concerning the staff and workers of the joint venture companyshall be drawn up between the joint venture company and the tradeofthe joint venture company as a whole, or the individual employees in thejoint venture company as a whole or individual employees in accordancewith the Re

59、gulations of the Peoples Republic of China on Labor Managementin Joint Ventures Using Chinese and Foreign Investment and itsImplementing Rules.The labor contracts shall, after being signed, be filed with the locallabor management department.Article 41The appointment of high-ranking administrative pe

60、rsonnel recommendedby both parties, their salaries, social insurance, welfare and thestandard of travelling expenses etc. shall be decided by the meeting ofthe board of directors.Chapter 14 Taxes, Finance and AuditArticle 42The joint venture company shall pay taxes in accordance with theprovisions o

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