The board of directors of a limited company is generally constituted by a board of shareholders. A Chinese WFOE’s board has 3-13 members, the board of directors is composed of directors, who are in charge of the company’s internal affairs and represent the company’s business decisions and business executive bodies externally. The company shall have a board of directors, which shall be elected by the shareholders’ (general) meeting. The board of directors shall have a chairman and a vice-chairman. The method for the election of the chairman and vice-chairman shall be prescribed in the articles of association of the company and generally elected by the board of directors. The term of office of a director shall be prescribed in the articles of association, which shall be a maximum of three years.
How to set up Chinese WFOE board of directors positions and what requirements have to prepare for setting up a WFOE board of directors in China. Let’s go ahead.
What requirements for board of directors positions of a Chinese WFOE
According to Chinese company laws, one of the director can be appointed as the executive director (known as legal representative) in the company structure. The following table is a requirements list of different nationalities for corporate board of directors.
|Nationality of the director||Documents have to prepare|
|Chinese nationality||Photo, and original ID card need to submit local registry authority|
|Foreign nationality||Photo, and appointment letter signed by shareholder(s), and passport copy verified by local registry authority|
What duties for Chinese WFOE board of directors
According to the provisions of the company law and the articles of association, the board of directors is the decision-making body of the company and the permanent authority of the board of shareholders. The board of directors is accountable to the board of shareholders.
1. Responsible for convening the shareholders’ meeting; To implement resolutions of the board of shareholders and report work to the board of shareholders;
2. Decide on the company’s production and operation plans and investment plans;
3. Decide on the establishment of the company’s internal management structure;
4. Approved the basic management system of the company;
5. Listen to the work reports of the executive director and general manager and make resolutions;
6. Made plans for the company’s annual financial forecast and final accounts, profit distribution plans and plans to cover losses;
7. Put forward plans for major matters such as increase or decrease of registered capital, division, merger, termination and liquidation of the company;
8. Appoint or dismiss the general manager, deputy general managers and heads of the financial department, and decide on the rewards and punishments.
Duties of Chinese WFOE’s executive director
1. Presided over the convening of the general meeting of shareholders and the meeting of directors, and was responsible for the implementation of the resolutions of the above meeting.
2. Convened and chaired senior management meetings, organized discussions and decided on the company’s development plan, business policy, annual plan and major issues in daily operations.
3. Nominate the hiring and dismissal of the general manager and other senior management personnel of the company, and report to the board of directors for approval and filing.
4. Propose the remuneration, treatment and payment method of the company’s senior management and report to the board of directors for the record.
5. Regularly review the company’s financial statements and other important statements, and fully control the financial status of the whole company system.
6. Signed and approved the transfer of management personnel and general cadres at all levels to the company;
7. Signing all kinds of important statements, documents and materials that have been submitted and printed to the public.
8. Handle other important matters authorized by the board of directors.