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Q: True, you get Shanghai license plate moment you registered a company?
A friend told me yesterday, if you open a company in Shanghai, China and you deposit 1 million RMB in it. Than you get an license plate for free. (worth in SH, roughly 80,000 RMB).
But can I get out the 1 million RMB later or there are conditions of the deposit?
10 years 41 weeks ago in Business & Jobs - China
The 1 million rmb you talk about is registered capital. If you were to open a business, as a foreigner this would be expected in a stated foreign currency. The registered capital is for the running of the company.
How it works is you are given an agreed amount of time during which you transfer the capital into a specially designated business account controlled by the People's Bank of China and the State Administration of Foreign Exchange.
Once the money is the account, they and they alone can authorize when it is withdrawn and how it is used. As a general rule of thumb, the government will allow you one or two years to register 100% of the registered capital but usually stipulate that 20% is registered within three months of company registration.
When the money is received, your accountant must write a report which is presented to the government for inspection. When the report has been ratified, you take it (along with various other documents and company stamps) to the bank where the account is held. They will issue you with special cheques and a password generator to withdraw the capital.
Some points to consider:
The capital must be transferred from a foreign based bank account under your exact name as shown within the passport. It used to be possible to borrow registered capital and put it through your account. Whilst technically that is still possible, you now need to find a company that is prepared to pay large sums of money into your personal account abroad. Companies will rarely take that risk so the passport name stipulation that came into force about two or three years ago has all but eliminated the practice of borrowing RC.
If the name on the transfer docket received by the PBOC or SAFE do not exactly match that in your passport, you cannot access the capital and cannot register it. Until all of the actual RC has been received in your passport name, the money will sit in your RC account and even then, the PBOC will only allow it to be transferred back to the account from which it originated. You have to pay all costs associated with this.
The PBOC can also control the way the capital is used. Whilst you can access the 1 million rmb, don't expect to just be able to take it back out of the business. It doesn't work like that. The bank where the RC is held have to inform the PBOC of any withdrawal from your RC account.
Misuse of the system can render you liable for prosecution or seizure of capital or other assets.
I'm thinking if you've got 1 million rmb just laying around, then what's 80k for a plate? 
bkmulder:
Everybody likes incentives and also the question came from a friend of mine. He told me, or I invest the money and you get a free license plate and if you can use the money for other things (outdated now see comment Kaiven) than you can keep the 80K RMB in your pocket and spent it wisely in one of the sophisticated bars at the Bund, Shanghai. :-)
