China has a solid and a representative economy which plays a major role on an international scale. Oriented towards consumers worldwide, the manufacturing sector is extremely developed, and numerous large companies decide to do business in China and benefit from varied advantages, among which the workforce is the most important one. A WFOE in China can be a proper start for investors abroadwilling to enter the Chinese market. Our company formation agents in China can offer support, information, and guidelines at the time of company registration in the major cities of China.
How can I open a WFOE in China?
Foreign investors who want to set up a business in China can direct the attention to Wholly Foreign-Owned Enterprises or WFOEs which are the most popular business forms that suit the needs of such entrepreneurs. This is actually the limited liability company in China for foreign owners who want to do business in this country. The Articles of Association are the representative documents of a WFOE in China and must be submitted to the local Trade Register at the time of incorporation. This is an independent legal structure in China which can be used in a wide range of commercial activities. Besides opening WFOEs in China, investors can set up joint-stock companies, representative offices, partnerships, branches, subsidiaries or can act as sole traders on the market. We remind that for any type of structure you may choose, our specialists in company formation in China are at your disposal with comprehensive information and help with the company registration.
Here is a video presentation about how you can start a business in China:
What is the managerial structure of a company in China?
From the beginning, we mention that the name of your company must be translated into Chinese and must be approved by the Administration of Industry and Commerce in China. As for the structure of the firm, this has to contain:
•the higher level management (CEO, chairman, personal director)
•the middle level management (marketing director, chief accountant, human resources);
•the legal representative of the firm and the company secretary.
Open a bank account for your business in China
In order to provide the minimum share capital for your company in China, a bank account must be opened in the local currency. On request, this bank account can have additional currencies, depending on the type of activities of the business. The same bank account can be used for other financial operations of your firm in China. Please bear in mind that for opening a bank account, the certificate of incorporation and the identification number are solicited by the financial authorities. If you want to start a company in China, our advisors can offer complete support in this sense, regardless of the chosen city for business.
Do I need an accounting firm?
In most cases, entrepreneurs who decide to do business in China can hire accountants in charge of bookkeeping, payroll, annual financial statements and tax advice among many others. For complete effectiveness in this field, it is suggested to hire an accounting firm and benefit from the proper services offered at any time.
Taxes in China
If you want to register a company in China, it is suggested to consider and analyze the tax regime. At the moment, the corporate income tax is set at 25% but it may vary, depending on the profits and activities. As for the sales tax, this is set between 3 and 5%. Also, there are customs duties, individual income taxes and a VAT set at 17%.
Workforce in China
The Chinese workforce is very much appreciated worldwide and represents a solid benefit for foreign investors who want to start their operations in this country. The workforce in China is known as highly skilled in most prolific areas among which we mention the IT sector, the engineering, automotive, tourism, manufacturing.
Shelf company in China
Ready-made companies in China are available for foreign investors who want to implement their operations on the market as fast as possible, without needing to wait for the incorporation process. These are companies already registered and kept on a shelf until they age and then purchased by entrepreneurs, whether domestic or from overseas. A shelf company has an accounting history of two years, it has no debts, and the ownership transfer can be issued in approximately 30 days. It is good to know that foreigners do not need to travel to China for acquiring a shelf company, and more than that, there is no need for a minimum share capital.
As it is known, China is a major economic force sustained by all important industries in which a wide range of investments are made each day. Because it is an important financial center, China has developed a multitude of business connections with powerful countries worldwide. China is also known as the “World’s factory”, (it has the most developed manufacturing sector and it is the largest exporter in the world), and according to the International Monetary Fund (IMF), it represents the largest economy by purchasing power parity. Moreover, according to recent statistics, the natural resources of China are worth USD 23 trillion.
For complete support in company registration in China, please feel free to contact our Chinese team of company formation consultants.
Call us now at +44 203 287 0408to set up an appointment with our company formation specialists in China. Alternatively you can incorporate your company without traveling to China.
As a BridgeWest client, you will benefit from the joint expertize of local lawyers and international consultants. Together we will be able to offer you the specialized help you require for your business start-up in China.