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Shenzhen IT Industry Equity Joint Venture (EJV) Formation

Shenzhen IT industry Joint Venture is a company set up and invested by Chinese and foreign investors. It effectively uses the advantages of local enterprises. There are two types of joint venture: Equity Joint Venture (EJV) and Co-operative Joint Venture.

Shenzhen IT Industry Equity Joint Venture

A foreign company wishing to establish a business in Shenzhen IT industry can do so by means of a Foreign Equity Joint Venture Enterprise in partnership with a Chinese partner. This is a form of Chinese limited liability company between a Chinese and a foreign party and is therefore a separate legal entity. Each participant contributes to the venture in financial terms by way of an investment of capital and therefore has a stake in the business. This is similar to the holding of shares in a limited company.

Shenzhen IT Industry Equity Joint Venture Features

However the foreign participant is not able to recover the investment until the termination of the joint venture. The joint venture also brings together the respective skills and technologies of each party.

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