Will it matter if the company previously registered at the address has not been cancelled?

Under applicable law, only one company can be registered at one address; in other words, if the registration of the previous company at the address has not been cancelled, no new company can be registered at the same address. In the example case, the fact that the previous company could not be cancelled due to its huge tax default and was unable to relocate to another location prevented Jin's new company from applying for a business license.

Will the upgrade of firefighting equipment influence the opening of the company?

For certain special industries (e.g. catering), strict requirements are imposed by the fire and sanitation departments on the fire safety and sanitation facilities of business premises. Only when design requirements have been met and fire safety and sanitation approvals have been obtained will the premises be permitted to publicly operate. For this reason, when selecting the company's address, the fire safety and sanitation conditions of the premises and the cost for any necessary upgrades must be taken into consideration.

What issues should be noted with respect to the company's decorations?

Since premises to be leased for office space may include existing interior decorations, before the new occupier begins redecorating, it should confirm the extent of the original decorations with the landlord. If this is not done, the new occupier will not be able to evaluate the residual value of the original decorations if it should be involved in a subsequent lawsuit against the landlord, and any claim for compensation of its decoration expenses is likely to be rejected.

What preparations should be made before signing an office lease agreement?

1. Conduct a property rights investigation at the Real Estate Exchange Center to confirm the type of premises and the zoning of the land, and to ensure that the landlord holds good title to the premises or has been authorized by title holder in a legal document.

2. Conduct an AIC check on company registration with respect to the premises. If a company is already registered therein, make sure to have that company cancel its registration or relocate to another address; otherwise the new tenant may have trouble registering a new business license.

3. If the tenant engages in a restricted industry, it also needs to learn about the restrictions that apply to that particular industry from the public security or fire department. Only when the tenant is recognized and granted the appropriate license by the relevant authority will it be able to commence legitimate public business operations.

Several issues to be specially noted when signing a lease agreement

1. Clarify the purpose of the contract in order to avoid the occurrence of force majeure events that might influence future normal production and operational activities. By doing so in the lease agreement, the tenant will be able to terminate the agreement on the ground that the purpose of the contract cannot be realized, thereby mitigating its losses.

2. When a special industry is involved, the obligations and duties of the landlord at the time of application for the relevant licenses should be clarified in order to avoid arguments over liability in the event of a dispute.

3. Link the payment schedule and the amount of the rental with the approval application progress, to effectively prevent the tenant from remaining liable for full payment of the rental even if the premises fail to obtain approval and cannot be used for business operations.

4. Clarify how to deal with the residual value of the decorations. It is also advisable to agree on the positions of advertising or shop signage in order to determine the means of evaluation and the compensation for the residual value when the contract expires or is early terminated.

(Abstracted from Why Do Companies Take Pains in Selecting Addresses? by Lifei Jiang)

华诚律师事务所（Watson&Band）

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.