Individually-owned Businesses

Access Requirements in Brief

Under CEPA, Hong Kong permanent residents with Chinese citizenship are allowed to set up individually-owned businesses in the Chinese mainland without being subject to foreign investment approval procedures. These businesses are limited to individually-owned establishment in terms of composition and have no limits for the number of employees and business area. They cannot be family-owned and change of operator is not permitted.

Scope of Business

Under CEPA, Hong Kong permanent residents with Chinese citizenship may set up, in accordance with the relevant mainland laws, regulations and administrative regulations, individually-owned businesses in all provinces, autonomous regions and municipalities directly under the Central Government, without being subject to approval procedures applicable to foreign investments, excluding franchising operation.

Scope of business includes: grain cropping; cropping of vegetables, ornamental crops such as edible mushroom; fruit cropping; nut cropping; spice cropping; cropping of Chinese herbal medicine; forestry[1]; animal husbandry; poultry husbandry; aquaculture; irrigation services; primary processing services of agricultural products (excluding processing of seed cotton); other agricultural services; forestry services; animal husbandry services; fishery services (aquaculture breeding production permits required); grinding of grains (excluding processing of rice and flour); processing of meat products and sub-products (excluding western meat products processing items of 3000 tonnes/year or below); aquatic products refrigeration processing; minced fish products and aquatic products dry-cure processing (excluding frozen minced seawater fish production line); processing of vegetables, fruits and nuts; manufacture of starch and starch products (excluding wet process production line of corn starch with annually-processed corn below 300,000 tonnes and oven-dry yield below 98%); manufacture of bean products; processing of egg products; manufacture of baked food; manufacture of candies, chocolate and succade; manufacture of convenience food; manufacture of dairy products [excluding concentrating and spray dry equipment with the daily processing capacity of raw milk (two shifts) below 20 tonnes and manual and semi-automatic liquid milk canning equipment below 200 kilogram/hour]; manufacture of canned food; manufacture of gourmet powder; manufacture of sauces, vinegar and similar products; manufacture of other flavourings and fermented products (excluding salt); manufacture of nutrition food; manufacture of cold beverages and edible ice; beer brewing (excluding beer filling production line with production capacity less than 18,000 bottles/hour); vinification; manufacture of carbonated beverages [excluding production line of carbonated beverages with production capacity below 150 bottles/minute (with bottle volume of 250 ml or less)]; manufacture of bottled (canned) drinking water; manufacture of fruit/vegetable juice and fruit/vegetable drinks; manufacture of milk beverages and vegetable protein beverages; manufacture of solid beverages; manufacture of tea beverages and other beverages; textile industry; manufacture of curtains and fabric products; textile and garments, garment industry; leather, furs, feathers and related products and footwear manufacturing industry; timber processing and wood, bamboo, cane, palm and straw products industries; furniture manufacturing industry; paper making and paper products industries (excluding production of rice paper); manufacture of stationery, education and office products; manufacture of musical instruments; manufacture of arts and crafts (excluding carving and processing of nationally key protected wildlife, production of bodiless lacquerware, production of enamelware and production of inksticks); manufacture of sporting goods; manufacture of toys; manufacture of amusement equipment and entertainment goods; manufacture of daily chemical products; manufacture of plastic products; manufacture of daily glass products, manufacture of daily ceramic products; manufacture of metal tools; manufacture of porcelain-on-steel daily commodities and other porcelain-on-steel products; manufacture of metal daily commodities; manufacture of bicycles; manufacture of off-road leisure vehicles and spare parts; manufacture of batteries; manufacture of domestic electrical appliances; manufacture of non-electrical domestic appliances; manufacture of lighting tools; manufacture of clocks, watches and timers; manufacture of glasses; manufacture of daily sundries; wholesale of forestry products; wholesale of textile, apparel and household goods; wholesale of stationery; wholesale of sporting goods; wholesale of other cultural goods; trade agency; other trade brokerage and agency; import and export of goods and technologies; retailing services (excluding the retailing of tobacco products and franchising operation); retailing of books, newspapers and journals; retailing of audio-video products and electronic publications; retailing of arts and crafts and collectibles (excluding the retailing of cultural relics collectibles); road freight transport; other maritime transport auxiliary activities, specifically referred to port cargo loading and unloading services, storage and warehousing, port supplies (vessel materials and daily commodities), leasing and repair of port facilities, equipment and port machinery; goods handling and loading/unloading services, and transport agency services (excluding agency services for air passenger and cargo transport, and agency for mainland internal water transport); storage and warehousing services; food and beverages services; software development; information system integration services; information technology consulting services; data processing and storage services (only limited to business of offline data processing services); leasing services; economic and trade consulting and company management consulting in socio-economic consulting; advertising; intellectual property services (excluding trade mark agency services and patent agency services); packaging services; the following items of office services: the design and production services of signs and bronze plaques, the design and production services of trophies, plaques, medals and silk banners; translation services under office services; two items of the other unlisted business services under the business services: corporate ceremonial services: ceremonial services for opening ceremonies, celebrations and other major events; personal business services: personal image design services, organisation services of personal activities, and other personal business services; research and experimental development (excluding research in social sciences and humanities); professional technical services; quality inspection technical services (excluding animal quarantine services, plant quarantine services, inspection/testing and certification-related services, and special equipment inspection/testing services); engineering technology (excluding planning management, surveying, design and supervision); photography and photographic processing services; scientific technology promotion and application services; technology promotion services; scientific technology intermediary services; sewage treatment (excluding environmental quality monitoring and pollution source investigation services); air pollution control (excluding environmental quality monitoring and pollution source investigation services); refuse disposal (excluding environmental quality monitoring and pollution source investigation services); noise abatement services under other pollution control and other environmental protection services (excluding environmental quality monitoring and pollution source investigation services); municipal facilities management (excluding environmental quality monitoring and pollution source investigation services); environmental sanitation management (excluding environmental quality monitoring and pollution source investigation services); washing, cleaning and dyeing services; hair dressing and beauty treatment services; bathing services; marriage services under residents services (excluding matchmaking services); other residents services; repair of motor vehicles[2]; repair of computers and auxiliary equipment; repair services of household electrical appliances; repair services of other daily goods; building-cleaning services; other unlisted services: pet services (to be operated in cities only); outpatient clinic; sports; craft activities which are mainly for the purpose of leisure and entertainment (pottery, sewing, painting etc.) under other indoor entertainments; cultural entertainment agents; sports agents; wholesale of food and beverage; general guesthouses; other accommodation services; real estate intermediary services; operation of activities with individually owned real estates.

Application Procedures

According to the Opinions of the State Administration for Industry and Commerce on Further Lifting Control Over Application by Hong Kong and Macau Residents for Registration of Individually-owned Businesses in the Mainland, Hong Kong residents applying for the establishment of individually-owned businesses in all provinces, autonomous regions and municipalities directly under the Central government are no longer subject to examination and approval for foreign investment. Industry and commerce administration departments of counties, autonomous counties, cities not divided into districts and municipal districts where such individually-owned businesses carry out operation shall directly register such business. Registration organs may also entrust qualified local administrations for industry and commerce to register individually-owned businesses established by Hong Kong residents.

Before establishing their business, Hong Kong residents may apply to registration organs for the pre-approval of their trade name or name. The registration organs shall pre-approve the trade name or name of these businesses with reference to the Provisions on Administration of Enterprise Name Registration and issue the Notice on Pre-approval of the Trade Name or Name of Individually-owned Business.

Applications for the establishment of individually-owned businesses may be submitted in the following ways or by agent:

1. Submission to the administrative office of industry and commerce at the place of business;
2. Submission to the place of business of the registration organ;
3. For application submitted by post, fax, electronic data exchange or email, the applicant shall, within five days from the day it receives the Acceptance Notice from the registration organ, submit to the registration organ the original application materials that are identical in content to the materials sent by fax, electronic data exchange or email.

Hong Kong residents applying for registration of individually-owned businesses must submit the following documents:

• Application for Business Opening Registration of Individually-owned Business;
• Individually-owned Business Operator Registration Form (Hong Kong and Macau residents);
• Identity document;
• Proof of place of business;
• Other documents as required by state laws and regulations;
• Notice on Pre-approval of Trade Name or Name of Individually-owned Business if the trade name or name of the business has been pre-approved;
• Approval documents issued by the departments concerned for businesses that engage in activities subject to examination and approval by the departments concerned as prescribed by laws and administrative regulations.

Identity documents that Hong Kong residents are required to submit when applying for the establishment of individually-owned businesses include:

• Copy of Hong Kong Permanent Resident Identity Card;
• Copy of Mainland Travel Permit for Hong Kong and Macau Residents or Hong Kong Special Administrative Region Passport (either one).

The registration organ shall issue an Acceptance Notice and have it registered on the spot if it accepts an application for registration. It shall make a decision on whether or not to approve registration within 15 days from the day of acceptance of the application form. If registration is approved, a Notice of Registration of Individually-owned Business shall be issued and the applicant shall be issued the Business Registration Licence of Individually-owned Business within 10 days. The registration organ shall issue to the applicant a notice on rejection of registration if registration is not approved.

Related links

For more details about individually-owned businesses (or stores) under CEPA, please visit the website of the Hong Kong Trade and Industry Department.

For guidelines given by the Guangdong Province Administration for Industry and Commerce on individually-owned businesses (Chinese only), please click here to view.

[1] The development of commercial plantation for wood-based oil materials, such as oil tea, walnut, oil olive, eucommia ulmoides, oil-use peony, amygdalus pedunculatus, etc., shall be approved by the local forestry authorities at provincial level.

[2] Repair and maintenance of vehicles and motorcycles.