WholeDoc.
Chapter1GeneralProvisions
InaccordancewiththeLawofthePeople'sRepublicofChina on Chinese-ForeignCooperativeJointVenturesandother relevant Chinese laws andregulations,_______________Companyand _________Company, in accordancewiththeprincipleofequalityandmutual benefit and through friendlyconsultations,agreetojointlysetupaCooperative venture in _______
thePeople'sRepublicofChina.
Chapter2PartiesoftheCooperativeVenture
Article1
Partiestothiscontractareasfollows:_________Company(hereinafterreferredtoasPartyA),registeredwith______in China, and its legaladdressisat____________(street)_______(district)_____________(city)_____________China.
Legalrepresentative: Name:
Position:
Nationality:
___________Company(hereinafterreferredtoas Party B), registered
with_______.Itslegaladdressat___________.
Legalrepresentative: Name:
Position:
Nationality:
(Note:Incasetherearemorethantwoinvestors,theywillbecalled
PartyC,D...inproperorder).
Chapter3EstablishmentoftheCooperativeVentureCompany
Article2
InaccordancewiththeCooperative Venture Law and other relevantChineselawsandregulations,both parties of the Cooperative ventureagreetosetup___________Cooperativeventurelimitedliabilitycompany
(hereinafterreferredtoastheCooperativeventurecompany).
Article3
ThenameoftheCooperativeventurecompany is______________ LimitedLiabilityCompany.
Thenameinforeignlanguageis_________.
The legal address of the joint venture company is at__________street________(city)____________province.
Article4
AllactivitiesoftheCooperativeventurecompanyshallbegovernedbythelaws,decreesandpertinentrules and regulations of the People's
RepublicofChina.
Article5
TheorganizationformoftheCooperativeventurecompanyisa limited
liabilitycompany.The profits, risks and losses of the Cooperative
venturecompanyshallbesharedbythepartiesaccordingto the relevant
provisionsthereafter.
Chapter4ThePurpose,ScopeandScaleofProductionandBusiness
Article6
ThegoalsofthepartiestotheCooperative venture are to enhance
economiccooperationtechnicalexchanges,toimprovetheproduct quality,
developnewproducts,andgainacompetitivepositionintheworld market
inqualityandpricebyadoptingadvancedandappropriate technology and
scientificmanagementmethods,soastoraiseeconomicresultsand ensure
satisfactoryeconomicbenefitsforeachCooperator.
(Note:This article shall be written according to the specific
situationsinthecontract).
Article7
TheproductiveandbusinessscopeoftheCooperative venture company
istoproduce________products;providemaintenanceserviceafterthesale
oftheproducts;studyanddevelopnewproducts.
(Note:Itshallbewritteninthecontractaccordingto the specific
conditions).
Article8
TheproductionscaleoftheCooperativeventurecompanyisasfollows:
1.TheproductioncapacityaftertheCooperativeventureis put into
operationis _________.
2.Theproductionscalemaybeincreasedupto_____________ with the
developmentoftheproductionandoperation.Theproductvarietiesmay be
developedinto____________.
(Note:Itshallbewrittenaccordingtothespecificsituation).
Chapter5TotalAmountofInvestmentandtheRegisteredCapital
Article9
ThetotalamountofinvestmentoftheCooperativeventure company is
RMB____________(ora foreign currency agreed upon by both parties).
Article10
TheregisteredcapitalofthejointventurecompanyisRMB__________.
(Exclusiveoftherighttotheuse of the site or the right to the
exploitationofthenaturalresourcesandpremisescontributedbyParty
A.)
Article11
PartyAandPartyBwillcontributethefollowingto the cooperative
venture:
PartyA:premises__________m2
therighttotheuseofthesite_________m2
PartyB:cash______________Yuan
machinesandequipment____________Yuan
industrialproperty__________Yuan
others_____________Yuan,___________Yuaninall.
(Note:Whencontributingindustrialpropertyas investment, Party A
andPartyBshallconcludeaseparatecontracttobeapartof this main
contract).
Article12
TherighttotheuseofsitecontributedbyPartyAshallbe for the
useofthecooperativeventurecompany within _______________days after
theapprovalofthecontract.
Thecashcontributed by Party B shall be paid in_______________
installment.Eachinstallmentshallbeasfollows:
(Note:itshallbewritten according to the concrete conditions).
Article13
ThemachinesandequipmentcontributedbyPartyBasinvestment shall
meettheneedsofthecooperativeventurecompany,andshallbecarriedto
theChineseport_________days before the completion of the premises
construction.
Chapter6ResponsibilitiesofEachPartytotheJointVenture
Article14
PartyA and Party B shall be respectively responsible for the
followingmatters:
ResponsibilitiesofPartyA:
Handlingofapplicationsforapproval,registration,business license
andothermattersconcerningtheestablishmentofthecooperative venture
companyfromrelevantdepartmentsinchargeofChina;
Processingtheapplicationfortherighttotheuseofasite to the
authorityinchargeoftheland;
Organizingthedesignand construction of the premises and other
engineeringfacilitiesofthecooperativeventurecompany;
AssistingPartyB to process import customs declaration for the
machineryandequipmentcontributedbyPartyBasinvestmentandarranging
thetransportationwithintheChineseterritory;
Assistingthecooperativeventurecompany in purchasing or leasing
equipment,materials,rawmaterials,articlesfor office use, means of
transportationandcommunicationfacilitiesetc.;
Assistingthecooperativeventurecompanyincontacting and settling
thefundamentalfacilitiessuchaswater,electricity,transportation
etc.;
Assistingthecooperativeventure in recruiting Chinese management
personnel,technicalpersonnel,workersandotherpersonnelneeded;
Assistingforeignworkersandstaffinapplyingforentryvisas, work
licensesandhandlingtheirtravelprocedures;
Responsibleforhandlingothermattersentrusted by the cooperative
venturecompany.
ResponsibilitiesofPartyB:
Providingcash,machineryand equipment, industrial property... in
accordancewiththeprovisionsofArticle 11 and Article 12, 13, and
responsibleforshippingcapitalgoodssuchasmachineryandequipment
etc.contributedasinvestmenttoaChineseport;
Handlingthemattersentrustedby the cooperative venture company,
suchasselectingandpurchasingmachineryandequipmentoutsideChina,
etc.;
Providingnecessarytechnicalpersonnelfor installing, testing and
trialproductionoftheequipmentaswellasthetechnical personnel for
productionandinspecting;
Trainingthe technical personnel and workers of the cooperative
venturecompany;
IncasePartyBisthelicensor, it shall be responsible for the
stableproductionofqualifiedproductsofthecooperativeventurecompany
inthelightofdesigncapacitywithinthespecifiedperiod;
Responsibleforothermattersentrustedbythejointventurecompany.
(note:Itshallbewrittenaccordingtothespecificsituation).
Chapter7Distribution of Profitsand Repayment for PartyB'sInvestment
Article15
Thecooperative venture company shall distribute its profits in
accordancewiththefollowingprocedureafterpayingtheincometax_______%as allocations forreservefunds,expansion funds,welfarefundsandbonusesforstaffandworkersofthecooperativeventurecompany__________% as repayment for Party B's investment and___________YearsscheduledtopaybackallPartyB'sInvestment;____________%oftheleftdistributedtoPartyAand ___________% toPartyB.
Chapter8SellingofProducts
Article16
Theproductsofcooperativeventurecompanywillbesoldboth on the
Chinese and the overseas market, the export portion accounts for
____________%,____________%forthedomesticmarket.
(Note:Anannual percentage and amount for outside and domestic
sellingwillbewrittenoutaccordingtopracticaloperations, in normal
conditions,theamountforexportshallatleastmeettheneedsofforeign
exchangeexpensesofthejointventurecompany).
Article17
Productsmay be sold on overseas markets through the following
channels:
Thecooperativeventurecompanymaydirectlysellitsproductson the
internationalmarket,accountingfor_________%.
Thecooperativeventurecompanymaysignsalescontractswith Chinese
foreigntradecompanies,entrustingthem to be the sales agencies or
exclusivesalesagencies,accountingfor__________%.
Thecooperativeventurecompany may entrust Party B to sell its
products,accountingfor________%.
Article18
Thecooperativeventure'sproductstobesoldinChinamaybe handled
bytheChinesematerialsandcommercialdepartmentsbymeansofagency or
exclusivesales,or may be sold by the cooperative venture company
directly.
Article19
Inordertoprovidemaintenanceservicetotheproductssold both in
Chinaorabroad,thecooperativeventurecompanymaysetupsalesbranches
formaintenanceservicebothinChinaorabroadsubjecttotheapprovalof
therelevantChinesedepartment.
Chapter9TheBoardofDirectors
Article20
Thedateofregistrationofthecooperativeventurecompany shall be
thedateoftheestablishmentoftheboardofdirectorsofthecooperative
venturecompany.
Article21
Theboardofdirectorsiscomposedof____________directors,of which
___________shallbeappointedbyParty A, ____________by Party B. The
chairmanoftheboardshallbeappointedbyPartyA,anditsvice-chairman
by Party B. The term of office for the directors, chairman and
vice-chairmansfour years, their term of office may be renewed if
continuouslyappointedbytherelevantparty.
Article22
Thehighestauthorityofthecooperativeventurecompanyshallbe its
boardofdirectors.It shall decide all major issues concerning the
cooperativeventurecompany.Unanimousapprovalshallberequiredfor any
decisionsconcerningmajorissues. As for other matters, approval by
majorityorasimplemajorityshallberequired.
(Note:Itshallbeexplicitlysetoutinthecontract).
Article23
The chairman of the board is the legal representative of the
cooperativeventurecompany.Shouldthechairmanbeunabletoexercisehis
responsibilitiesforanyreason,heshallauthorizethe vice-chairman or
anyotherdirectorstorepresentthejoint venture company temporarily.
Article24
Theboardofdirectorsshallconveneatleastonemeetingevery year.
Themeetingshallbecalledandpresided over by the chairman of the
board.Thechairmanmayconveneaninterimmeeting based on a proposal
madebymorethanonethirdofthetotalnumberofdirectors. Minutes of
themeetingsshallbeplacedonfile.
Article25
Themeetingshallbevalidonlywhenmorethantwothirdsofthetotal
numberofdirectorsattend.Incaseofabsence,thedirectorshallentrust
anotherpersontoattendandvoteforhimwithatrustdeed.
Chapter10BusinessManagementOffice
Article26
Thecooperativeventurecompanyshallestablish a management office
whichshallberesponsibleforitsdailymanagement.Themanagementoffice
shallhaveageneral manager, appointed by Party _____, ______deputy
generalmanagers,_____byParty _____;_____byParty______.The general
manageranddeputygeneralmanagerswhosetermsof office is _____years
shallbeappointedbytheboardofdirectors.
Article27
Theresponsibility of the general manager is to carry out the
decisionsoftheboardandorganizeandconductthe daily management of
thecooperativeventurecompany.Thedeputygeneralmanagersshall assist
thegeneralmanagerinhiswork.
Article28
Thegeneralmanager shall report to the board of directors the
operationconditionsofthecooperativecompanyevery three months, and
makeafinancialreporteverysixmonths.
Article29
Incaseofgraftorseriousderelictionofdutyon the part of the
generalmanageranddeputygeneralmanagers,theboardofdirectors shall
havethepowertodismissthematanytime.
Chapter11LaborManagement
Article30
Laborcontractcoveringthe recruitment, employment, dismissal and
resignation,wages,laborinsurance,welfare,rewards,penaltiesandother
mattersconcerningthe staff and workers of the cooperative venture
companyshallbedrawnupbetweenthecooperativeventurecompanyand the
tradeunioof the cooperative venture company as a whole, or the
individualemployeesinthecooperativeventure company as a whole or
individualemployeesinaccordancewiththelawofthe People's Republic
ofChinaonChinese-ForeignCooperativeJointVentures.
Thelaborcontractsshall,afterbeingsigned,befiledwiththelocal
labormanagementdepartment.
Article31
Theappointmentofhigh-rankingadministrative personnel recommended
byboth parties, their salaries, social insurance, welfare and the
standardoftravellingexpensesetc.shallbedecidedby the meeting of
theboardofdirectors.
Chapter12Taxes,FinanceandAudit
Article32
Thecooperativeventurecompanyshallpaytaxesinaccordancewiththe
provisionsofChineselawsandotherrelativeregulations.
Article33
Staffmembersandworkersofthecooperativeventurecompanyshallpay
individualincometaxaccordingtotheIndividualIncometax Law of the
People'sRepublicofChina.
Article34
Thefiscalyearofthejointventurecompanyshallbefrom January 1
toDecember31.Allvouchers,receipts,statisticstatements and reports
shallbewritteninChinese.
(Note:A foreign language can be used concurrently with mutual
consent).
Article35
Financial checking and examination of the cooperative venture company
shall be conducted by an auditor registered in China and reports shall be
submitted to the board of directors and the general manager.
IncasePartyBconsidersitnecessaryto employ a foreign auditor
registeredinanothercountrytoundertakeannualfinancial checking and
examination,PartyAshallgiveits consent. All the expenses thereof
shallbebornebyPartyB.
Article36
Inthefirstthreemonthsof each fiscal year, the manager shall
prepare the previous year's balance sheet, profit and loss statement and
proposa lregarding the disposal of profits, and submit them to the board
of directors for examination and approval.
Chapter 13 Duration of the Cooperative Venture
Article37
Thedurationofthecooperativeventurecompany is______ years. The
establishmentdateofthejointventurecompanyshallbethedateonwhich
thebusinesslicenseofthecooperativeventurecompanyisissued.
Anapplicationfortheextensionof the duration, proposed by one
partyandunanimously approved by the board of directors, shall be
submittedtotheMinistryofForeignTradeand Economic Cooperation (or
theexaminationandapprovalauthorityentrustedbyit)six months prior
totheexpirydateofthejointventure.
Chapter14The Disposalof Assetsafterthe Expiration of theDuration
Article38
Upontheexpirationoftheduration,theassetsshallbelongtoParty
A.
Chapter15Insurance
Article39
Insurancepoliciesofthejointventurecompanyon various kinds of
risksshallbeunderwrittenwiththePeople'sRepublic of China. Types,
valueanddurationofinsuranceshallbedecidedbytheboardofdirectors
inaccordancewiththeprovisionsofthe People's Insurance Company of
China.
Chapter16The Amendment,Alterationand TerminationoftheCon-tract
Article40
Theamendmentofthecontractor other appendices shall come into
forceonlyafterawrittenagreementhasbeensignedbyPartyAand Party
Bandapprovedbytheoriginalexaminationandapprovalauthority.
Article41
Incaseofinabilitytofulfilthecontractorto continue operation
duetoheavylossesinsuccessiveyearsasaresultofforcemajeure, the
durationofthecooperativeventureandthecontractshall be terminated
beforethetimeofexpirationafterbeingunanimouslyagreedupon by the
boardofdirectorsandapprovedbytheoriginalexamination and approval
authority.
Chapter17LiabilityforBreachofContract
Article42
Shouldthecooperativeventure company be unable to continue its
operationorachieveitsbusinesspurposeduetothefactthatoneof the
contractingpartiesfailstofulfil the obligations prescribed by the
contractandarticlesofassociation,orseriouslyviolatestheprovisions
ofthecontractandarticlesofassociation,thatpartyshallbedeemedto
haveunilaterallyterminatedthecontract.Theotherpartyshallhave the
righttoterminatethecontractinaccordancewiththeprovisions of the
contract after approval by the original examination and approval
authority,andtoclaimdamages.Incase Party A and Party B of the
cooperativeventurecompanyagreetocontinuetheoperation,thepartywho
failstofulfilitsobligationsshallbeliablefor the economic losses
causedtherebytothejointventurecompany.
Article43
ShouldeitherPartyAorPartyB fail to provide on schedule the
contributionsinaccordancewiththeprovisionsdefinedin Chapter 5 of
this contract, the party in breach shall pay to the other party
________Yuan,or__________%ofthecontributionstartingfrom the first
monthafterexceedingthetimelimit.Shouldthepartyinbreach fail to
provide after ______months, _________Yuan, or _________% of the
contributionshallbepaidtotheotherparty,whoshallhavetherightto
terminatethecontractandtoclaimdamagesfromtheparty in breach in
accordancewiththeprovisionsofArticle42ofthecontract.
Article44
Shouldallorpartofthecontractanditsappendicesbeunableto be
fulfilledowingtothefaultofoneparty,thepartyinbreachshall bear
theliabilitytherefor.Shoulditbethefaultofbothparties,theyshall
beartheirrespective liabilities according to the actual situation.
Article45
Inorder to guarantee the performance of the contract and its
appendices,bothPartyAandPartyBshallprovideeach other with bank
guaranteesforperformanceofthecontractwithin__________daysafterthe
contractcomesintoforce.
Chapter18ForceMajeure
Article46
Shouldeitherof the parties to the contract be prevented from
executingthecontractbyforce majeure, such as earthquake, typhoon,
flood,fire,warorotherunforeseen events, and their occurrence and
consequencesareunpreventableandunavoidable,thepreventedparty shall
notifytheotherpartybytelegramwithoutanydelay,andwithin 15 days
thereafterprovidedetailedinformationoftheeventsandavaliddocument
forevidenceissuedbytherelevantpublicnotaryorganization explaining
thereasonofitsinabilitytoexecuteordelaytheexecution of all or
partofthecontract.Bothpartiesshall, through consultations, decide
whethertoterminatethecontractortoexemptpartoftheobligationsfor
implementationofthecontractorwhethertodelaythe execution of the
contractaccordingtotheeffectsoftheeventsontheperformanceof the
contract.
Chapter19ApplicableLaw
Article47
Theformation,validity,interpretation,executionand settlement of
disputesinrespectof,thiscontractshallbegoverned by the relevant
lawsofthePeople'sRepublicofChina.
Chapter20SettlementofDisputes
Article48
Anydisputesarisingfromtheexecutionof,orinconnectionwith,the
contractshallbesettled through friendly consultations between both
parties.Incasenosettlementcanbereachedthrough consultations, the
disputesshallbesubmittedtotheForeignEconomicandTrade Arbitration
CommissionoftheChinaCouncilforthePromotionof International Trade
forarbitrationinaccordancewithitsrulesof procedure. The arbitral
awardisfinalandbindinguponbothparties.
Article49
Duringthearbitration,thecontractshallbeobservedandenforcedby
bothpartiesexceptforthemattersindispute.
Chapter21Language
Article50
ThecontractshallbewritteninChinese and in ____________. Both
languageversionsareequallyauthentic.Intheeventof any discrepancy
between the two aforementioned versions, the Chinese version shall
prevail.
Chapter22EffectivenessoftheContractandMiscellaneous
Article51
Theappendicesdrawnupinaccordance with the principles of this
contractareintegralparts of this contract, including: the project
agreement,thetechnologytransferagreement, the sales agreement etc.
Article52
Thecontractanditsappendicesshallcomeintoforcecommencing from
thedateofapproval of the Ministry of Foreign Trade and Economic
Cooperation of the People's Republic of China (or its entrusted
examinationandapprovalauthority).
Article53
Shouldnoticesinconnectionwithanyparty'srights and obligations
besentbyeitherPartyAorPartyB by telegram or telex, etc., the
Writtenletternotices shall be also required afterwards. The legal
addressesofPartyAandPartyBlistedin this contract shall be the
postingaddresses.
Article54
The contract is signed in __________, China by the authorized
representativesofbothpartieson_____,19_______.
ForPartyA ForPartyB
(Signature) (Signature)