The State Council, China's Cabinet, announced on Tuesday it has approved a plan to reform business registration in an effort to ease market access.
The reform marks a major move in transforming administrative functions and innovating the government's supervision role, and aims to build fair, open and transparent market rules, according to the reform plan published on the central government's website.
Specifically, requirements on minimum registered capital for limited liability companies, one-person limited liability companies, and joint-stock companies with limited liability will be scrapped.
Registration of business venues will also be simplified and flexible, according to the reform plan.
Annual inspections on registered companies will be replaced by companies' annual reports, which should be available to public inquiry. Companies that fake reports or fail to release reports according to requirements will be dealt with in accordance with laws.
According to the plan, the country will also promote electronic business licenses in an effort to build a standardized and convenient business registration system suitable for Internet technologies.
The requirement on minimum registered capital once blocked many who wished to start businesses. Analysts said the reform is expected to lower the hurdle greatly.
"We can't just stop people from starting businesses just because they lack money," said Xu Youjun, a market supervision official in Shenzhen in south China's Guangdong Province.
Xu said that since the city initiated the reform trials last year, market vitality had been boosted and more people were willing to start businesses.
According to the plan, the registration reforms do not apply to 27 categories of businesses, including commercial banks, financial leasing companies, securities firms, futures companies, fund management companies, and micro-credit companies.