Institutions refer to social service organizations organized by administrative organs or other organizations from the perspective of social welfare and engaged in education, science and technology, culture, health and other activities (see the State Council 4 1 1 Order "Provisional Regulations on the Registration and Management of Institutions").

Generally speaking, enterprise units are profit-making companies and enterprises, and such units have business licenses issued by the Administration for Industry and Commerce. Compared with enterprises, institutions are not established for profit, but branches of some state institutions without business licenses.

According to the Provisional Regulations on the Administration of Registration of Public Institutions and other relevant laws and regulations, the legal procedures for obtaining legal person status are completed by the registration administration organ of public institutions. When a public institution carries out activities, it must have the certificate of legal person of the public institution as the legal certificate of legal person qualification. There are many categories of institutions, reaching more than 100.

Directly affiliated institutions often refer to the branches of an institution, and the subordinate units of this branch are not called directly affiliated institutions. Branches and directly affiliated institutions of other institutions are not directly affiliated institutions of this institution. For example, TV stations are directly affiliated to the Radio and Television Bureau (Office), but TV stations with departments and units are not directly affiliated to the Radio and Television Bureau (Office).

Setting scheme

Directly affiliated institutions are directly subordinate to the core departments of the government and do not have independent legal person status and financial and personnel management rights. All employees of directly affiliated institutions are treated as civil servants. Such institutions should not consider economic income, and their activities are funded by the financial budget.

For example, a large number of policy research offices of governments at all levels can become directly affiliated institutions if they mainly serve government decision-making. A large number of schools and hospitals are suitable to become independent institutions, and some can implement the board management system.

This kind of institution has an independent legal person system, independent accounting rights and personnel rights, and the unit is supervised and managed by the board of directors equivalent to the board of directors like an enterprise. Independent institutions can generate income, but they must follow strict accounting, auditing and reporting systems.