On 4 January 2010, the State Administration for Industry & Commerce (“AIC”) and the Ministry of Public Security in China (“MPS”) jointly issued the Notice on Further Strengthening the Administration on Registration of Foreign Enterprises’ Representative Offices. The Notice will affect the representative offices of foreign enterprises across different industries including insurance, transportation, trading, manufacturing, services and so on. The Notice provides major changes in four main areas:Establishment or Name- Renewal: Foreign enterprise requires to be in existence for at least two years.  There was no such requirements before. This requirement will prevent a foreign enterprise existing for less than two years in China from setting up a representative office in China. An other new requirement under the Notice is, at the time of establishment or change of name of a representative office, copies of notarised and legalised documents before the relevant Chinese Embassies such as “ The Certificate of Incorporation/ Registration confirming the existence or Incorporation of the foreign enterprise for more than two years” and “ a letter issued by the foreign enterprise’s banker confirming its good standing and credit worthiness” have to be submitted. Validity Period of The Registration Certificate The valid term at present for the registration certificate of a representative office could be up to three years.  According to the Notice, the validity period of the registration certificate of a representative office shall be one year only. However, if the current validity period of the registration certificate exceeds one year, it will remain valid. But a new registration certificate with a one-year validity only will be issued to replace the existing certificate when the representative office applies for any alteration or extension. Restrictions on Number of Representatives According to the Notice, a foreign company’s representative office shall not exceed four registered representatives, including the Chief Representative. The Notice further provides that if an existing representative office currently has more than four representatives, such  representative office will not be permitted to have any additional representatives appointed. Activities In general, representative offices are not permitted to charge money in China. Activities of a representative office are restricted to performing marketing or liaison functions on behalf of its parent company. In order to investigate unlawful activities conducted by representative offices and other non-compliance issues, the Notice requires local administrations of industry and commerce to conduct spot checks on representative offices within three mpnths after they have obtained registration certificates. Representative offices found to be engaging in direct profit-making activities may receive administrative fines which are discovered to have changed location or exceeded valid term of residence without renewing their registration certificates may be subject to higher scrutiny.