According to relevant provisions under Chinese Law, a “foreign-invested insurance company” may take the following forms;
1) A joint venture insurance company in China established by a foreign insurance company and a Chinese company or enterprise;
2) A foreign insurance company solely owned and operated by a foreign insurance company;
3) A branch company of a foreign insurance company in China.
In general, a large amount of legislation is applicable to the establishment of a foreign-invested insurance company.
First, the Administration of Foreign-invested Insurance Company Regulations of the PRC promulgated by the State Council on 22 December 2001 and the Administration of Foreign invested Insurance Company Regulations Implementation Rules promulgated by CIRC on 13 May 2004 are the two important legislative measures dedicated to foreign invested insurance companies in China. They are playing an increasingly important role.
Secondly, for issues not included in the two measures above, the relevant provisions of the Insurance Law and the Administration of Insurance Company Provisions promulgated by CIRC on 13 May 2004 are applicable.
Finally, in the absence of provisions within the above mentioned laws and regulations, the Company Law, other relevant laws and administrative regulations shall be applied.
Under the current legal framework, foreign invested companies are principally governed by separate laws and regulations. The most important include the Sino-foreign Equity Joint Venture Law of the PRC and Foreign invested Enterprise Law of PRC, as well as the corresponding implementation rules promulgated or approved by the State Council. Where different provisions exist in these separate laws, the provisions of the separate legislation will prevail. However, for issues not covered in the separate legislation, the provisions of general laws and regulations are applicable. In addition, there are special laws and regulations regarding some specific issues of a company. For example, the Administration of Appointment Qualification for Directors and Senior Management Personnel of Insurance Companies Provisions promulgated by CIRC on 12 July 2006 set out detailed provisions regarding the conditions and the examination of the appointment qualifications and other related issues for directors and senior management personnel of insurance companies.