Starting a Business in Shanghai-One Procedure in One Day with Zero Cost ( 2021.04.30 )
One Procedure in One Day with Zero Cost
- making starting business more convenient
Streamlining procedure with digital technology
Entrepreneurs use the Integrated Registration Service (http://yct.sh.gov.cn, herein after referred to as IRS) system to apply for business license (including free physical official seals), invoice, social insurance for employment and provident fund registration by Filling in One Form. An enterprise can be registered in the whole-process paperless electronic mode, electronic business license (E-license) and electronic official seals (E-seal) are to be issued right after the approval. The registration of social insurance for employment and provident fund can be done wholly online. The whole process for starting business involves one website, which can be done efficiently in One Procedure.
Improving efficiency with information sharing
The IRS system is not only the online platform offering services for entrepreneurs, but also the hub of information exchange for government departments. Based on the principle of accurate sharing and efficient use of data, the online-offline procedure for starting business has been optimized and reconstructed, and the efficiency has been greatly improved. For starting business, an applicant can apply in the IRS system by Filling in One Form (for business license, official seals, invoice, social insurance for employment and provident fund registration), the whole procedure can be done in One Day.
Optimizing service with zero cost
A newly incorporated enterprise obtains an E-license and free E-seals. In Shanghai, free physical official seals and a tax U-Key are issued to every newly incorporated enterprise. The free physical seals (a set of four, including the seal of enterprise’s name, financial, invoice and the legal representative) and the free tax U-key are issued together with the printed paper license and invoices, which can be obtained at the Single Window of IRS system service counters in district administration service centers. Entrepreneurs don’t have to pay for the physical seals or tax control devices, the whole process of starting business is Zero Cost.
No bank accounts needed for registering social insurance for employment
According to the Announcement on Transferring the Collection of Enterprise Social Security Fee to Tax Authority (for details, see the bulletin of announcements of information disclosure channel on the official website of Shanghai Municipal Tax Service, State Taxation Administration), social security fees of employees in Shanghai are to be collected by the tax authority since November, 2020. To register social insurance for employment when starting business, it’s not required for an entrepreneur to sign a tripartite agreement of withholding or to choose the way of payment, there is no need to file the bank account information to government departments. No bank accounts are needed for registering social insurance for employment.
Integrating services to bring convenience
It is designed to be a one-stop service for starting business that fuses both online and offline procedures. Uniform service counters of IRS system for starting business are to be set up in administration service centers in all districts, providing applicants with aiding and guiding on-site. Entrepreneurs who need to obtain physical certificates can receive a Special Package of Starting Business (containing printed paper licenses, free physical seals, invoices, and a free tax U-key) at the Single Windows instead of visiting different departments or windows.
Introduction to the reform achievements on facilitation for starting business
In recent years, Shanghai Administration for Market Regulation, in cooperation with other relevant departments, has been continuously promoting the reform on facilitation for starting business, making it more convenient to start up a business in Shanghai. On March 31, 2021, Shanghai Administration for Market Regulation, jointly with other 6 departments (including Shanghai Municipal Commission of Economy and Informatization, Shanghai Public Security Bureau, Shanghai Municipal Tax Service, State Taxation Administration, Shanghai Municipal Human Resources and Social Security Bureau, Shanghai Provident Fund Management Center, The People’s Bank of China, Shanghai Head Office), issued the Opinions on accelerating the establishment of a digital service system for starting business (Regulation of SAMR  No. 7), denoting that the One-Stop service system for starting business in Shanghai has stepped into the digital era. Based on digital technology, the separate procedures for starting business which used to be processed in different departments are integrated into one, the efficiency of which is greatly improved from the perspective of enterprises. With optimized offline service, to start a business in Shanghai, an entrepreneur only needs to complete the application (for license, seals, invoice, social insurance for employment and provident fund registration) in one procedure in one day, the cost is zero.
1. One procedure for starting business
For entrepreneurs, to start a business in Shanghai, one can apply in the one-stop service mode and complete the registration in one procedure. To be specific, an applicant can apply for the business license (including free physical seals), invoice, social insurance for employment and provident fund registration by filling in one form in the IRS system, and obtain a special package of starting business (containing printed paper licenses, free physical seals, invoices, and a free tax U-key) at the Single Window in district administration service centers.
If the entrepreneur does not apply for invoice, register social insurance for employment or provident fund when applying for business license (including free physical seals), after obtaining the business license, it can also log into the IRS system and apply in the channel of optimized services by choosing the corresponding items.
2. One day for starting business
For entrepreneurs who choose to apply in the One Stop service mode, as long as the operation is completed and meets legal form, all the affairs related to starting business (application for business license, official seals, invoice, social insurance for employment, and provident fund registration) can be done in one day, and a special package can be obtained at the Single Windows in district administration service centers.
3. Zero cost for starting business
All newly incorporated enterprises can obtain free physical seals together with printed paper licenses at the Single Windows in district administration service centers. To ensure that the free physical seals are properly issued, entrepreneurs are required to tick the option of obtaining free seals (the default is ticked) in the IRS system when applying.
A free tax U-key is issued by the tax authority to every newly incorporated enterprise, which is used to issue invoices including VAT invoice. A newly incorporated enterprise doesn’t need to purchase tax control devices. Existing enterprises can also apply to the tax authority for free tax U-keys, and don’t need to pay maintenance fees for tax control devices any more.
4. Business license applied wholly online
For various types of enterprises which meet the criteria, entrepreneurs can apply in the whole-process paperless electronic mode, completing the registration wholly online and obtain the E-license. For details, please refer to the channel of tutorials on the homepage of the IRS system.
5. Applying for E-invoice in one form
Entrepreneurs can apply for various E-invoices including the VAT E-invoice by filling in one form in the IRS system or they can also apply separately for E-invoices in the IRS system after obtaining business license.
6. Simultaneous issue of E-license and E-seal
According to the Circular on the application of Electronic Business License and Electronic Seal of enterprises by six government departments including Shanghai Administration for Market Regulation（Registration of SAMR  No. 907），since April, 2020, E-license and free E-seal are issued to every newly established enterprise in Shanghai instead of the uniform authentication key for legal person.
(1) What is the E-license?
The E-license (short for electronic business license) is the legal certificate in electronic form issued by the administration for market regulation according to relevant laws and regulations under uniform standards, which records the registration information of a market entity. The E-license bears the same legal validity as the printed paper license, and is the legal certificate denoting the identification of a market entity. The E-license system is a uniform national system for verifying IDs of market entities, which provides uniform verification and identification service for market entities nationwide.
(2) How to obtain an E-license?
The E-license is issued by the administration for market regulation to every newly established enterprise when registered. Entrepreneurs don’t have to apply for E-licenses separately, instead legal representatives can use the mini apps on WeChat or Alipay, or the E-license App to download. By now, Shanghai Administration for Market Regulation has issued E-licenses to all market entities (including different types of newly established and existing enterprises, domestic and foreign invested, as well as individually-owned businesses), which can be obtained via the mini apps on WeChat or Alipay. The details of how to obtain the E-license can be checked on the homepage of the IRS system, in the tutorial of the E-license and E-seal.
(3) In which circumstances can the E-license be used?
According to the Circular on the application of Electronic Business License and Electronic Seal of enterprises by six government departments including Shanghai Administration for Market Regulation（Registration of SAMR  No. 907）issued on January 31, 2020, earlier in 2020, online systems related to starting business in Shanghai have all been connected to the E-license system, enterprises can apply wholly online for registration, annual report, archive inquiry, taxation, social insurance for employment, provident fund and so on. Meanwhile, ID verification and log-in service for market entities nationwide have been integrated into the Government Online-Offline Shanghai official website, all market entities in China are able to use the E-license to log into the system for government services.
Since August, 2020, entrepreneurs have been able to open bank accounts in paperless mode with the E-license in Shanghai, taking the lead in China. According to the Opinions on accelerating the establishment of a digital service system for starting business (Regulation of SAMR  No. 7), relevant departments will continuously promote the information sharing mechanism of E-license, providing banks offering service for enterprises with capabilities as inquiry, archiving, verification and so on. Commercial banks are encouraged to open accounts for enterprises using the E-license as the certification, thus enterprises don’t have to submit the original version or copies of the printed paper licenses.
You can browse and make use of E-license in various application scenes in the channel of E-license service zone on the homepage of the IRS system.
(4) Does a newly incorporated enterprise have to obtain the uniform authentication key for legal person (U-key)?
According to the Circular on the application of Electronic Business License and Electronic Seal of enterprises by six government departments including Shanghai Administration for Market Regulation（Registration of SAMR  No. 907）, since April, 2020, the issue of the uniform authentication key for legal person (U-key) to newly incorporated enterprises has been cancelled, various enterprises can use E-licenses to verify identification, log into online service systems of different government departments such as administration for market regulation, taxation, human resource and social security, provident fund management center and so on.
(5) What is the E-seal? What does the issue of E-seal together with E-license mean?
The E-seal is the visualization of the credible electronic signature, with the cryptographic technology as the core, which effectively combines the digital certificate, signature key with the mold of stamps of physical seals. The utilization of E-seal mainly involves the domain of electronic government service and e-commerce, which is deemed as a graphic electronic signature of integrity, authenticity, and non-repudiation on various electronic documents.
According to the Circular on the application of Electronic Business License and Electronic Seal of enterprises by six government departments including Shanghai Administration for Market Regulation（Registration of SAMR  No. 907）, a set of four E-seals (including the seal of the enterprise name, financial, invoices and the legal representative) which contain digital certificate, electronic signature key and mold of stamps is to be generated and issued together with the E-license. The E-seal and E-license are combined and to be issued simultaneously, free of charge.