30 Nov 2016
Shanghai FTZ Pilots Enterprise Name Registration Reform
As part of the overall reform plan of the State Administration for Industry and Commerce (SAIC), a new administration system for the registration of enterprise names was launched in the Shanghai Free Trade Zone (FTZ) on a pilot basis on 28 November. The new system is designed to be smarter and more transparent and user-friendly.
Since the establishment of the Shanghai FTZ, a series of commercial system reforms have been carried out in the Pudong New Area and in the FTZ on a pilot basis. These reforms cover areas such as “separating business licence from operating permit”; the registered capital registration system, and the residence registration system.
The latest reforms concerning the registration of enterprise names have two major features: “one negative list” and “one positive list”. The principle of “permitted unless otherwise prohibited” will be adopted in Shanghai. The requirements regarding enterprise names as stipulated in the rules and normative documents of relevant departments have been clarified and consolidated. General guidelines regarding prohibited or restricted words in company names have been drawn up, with the relevant information posted on the company name submission pages online.
“One positive list” refers to the database consisting of company names that are available for use. According to Chen Xuejun, party secretary and director of the Shanghai Administration for Industry and Commerce, the positive list is an inventory of company names that have been duly approved but have expired or were never used due to various reasons over the years. As such, these idle names are not being fully utilised. In a bid to speed up the name search and pre-approval processes as much as possible, the Shanghai Administration for Industry and Commerce has now freed up some 50,000 company names that can be readily used to start new businesses.
Under the new system, applicants can submit their proposed company names to the designated online services platforms operated by the city authorities or the Shanghai Administration for Industry and Commerce. Names constructed according to the official guideline of “administrative district + trade name + industry + company format” can be submitted online for auto-checking.
To safeguard the interests of famous trademarks and company names, the online system will automatically alert applicants if their submission will potentially infringe on existing trade names.