China Wealth News

Businesses Type Options in China

Before starting-up a business in China, you have to know your options. This article provides an overview, and links to more detailed articles about the most popular / common business structure options.

China offers great opportunities to investors from all over the world!  Despite any perceived/recent trade issues or tensions, there still is no country for entrepreneurship like China!

After decades of amazing growth, China is home to state of the art facilities, infrastructure, and a highly-skilled workforce that remains energized for new business growth. Also, the Consumer Base and Consumer Spending inside of China continues to grow at an exciting pace.

After China’s entry to the WTO, most industries in China welcome foreign investment. A structure called a ‘Wholly Owned Foreign Enterprise’ (WOFE) became the first option for foreign investors in China (instead of Rep. Office), and remains among the most popular.

To energize the continued growth, since 2016 the ‘Minimum Registered Capital’ requirement has been removed for certain types of WFOEs, specifically: Consulting, Trading, Retailing, or Information Technology. Minimum Registered Capital requirements do still exist however for some industries, such as: Banking, Forwarding, etc.

In addition to the WOFE structure, here are the most common structures for Foreign Investors:

1. Wholly Foreign Owned Enterprise (WFOE);

2. Partnership Enterprise (PE)

3. Representative Office;

4 . Joint Venture; and

5. Hong Kong company.

For accommodations concerning Tax Purposes & Planning, specific Licensing Agreements & Systems, or other reasons, Hong Kong is also an available & popular option. A Hong Kong entity can be used independent of, or in conjunction with, a mainland China corporation.

Of course, at China Wealth Consulting we can provide planning-consulting, as well as complete registration & operational services for both mainland China and Hong Kong – as well as similar services in other Asia countries via our Partner Network.

Please check the other article-links listed below for more detailed & updated procedures regarding the registration of these five different China business structures.

1. Incorporate a Wholly Foreign Owned Enterprise (WFOE) in China
2. Setting up a WFOE in Shanghai Free-Trade Zone (Most popular entity since 2017)
3. Foreign Invested Partnership Enterprise (FIPE) Formation in China without Capital
4. Setting up a Foreign Representative Office (RO) in China
5. Joint Venture (JV) Formation in China
6. Offshore Structure: Hong Kong Company formation
7. Mergers & Acquisitions in China

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