Meaning
Administrative reforms that decouple the acquisition of a business license from the receipt of specialized operating permits simplify the corporate setup process. The policy of separating certificates from business licenses allows investors to establish a legal entity first and apply for industry-specific permits later. This framework is administered by the State Council to reduce barriers to entry for new enterprises.
It applies to hundreds of commercial sectors, though highly restricted areas like banking still require pre-approval.
Procedural Sequencing
Securing the basic corporate registry before seeking specialized administrative approvals accelerates the incorporation timeline. Under the process of separating certificates from business licenses, a company receives its business license with its tax number immediately. This enables the company to lease office space and open bank accounts while preparing the applications for operational permits.
Regulatory Simplification
Replacing complex approval procedures with simple notification filings reduces the administrative burden on small businesses. The implementation of separating certificates from business licenses has converted several mandatory certifications into voluntary commitments. Companies can start operating in certain sectors by submitting a signed declaration that they meet all safety and environmental standards.
Market Entry
Lowering the initial capital and document requirements encourages foreign and domestic investment in pilot free trade zones. By utilizing the rules of separating certificates from business licenses, international firms can quickly establish a corporate presence. This facilitates a faster market entry while the parent company compiles the necessary clinical or technical dossiers for secondary permits.
