Four main options for establishing a Foreign Invested Enterprise (FIE) on Chinese mainland:

1. Wholly Foreign-Owned Enterprise (WFOE)

2. Representative Office (RO)

3. Partnership Enterprise

4. Joint Venture (JV)

Common Types of WFOE

. Manufacturing WFOE

. Consultancy / Service WFOE

. Trading WFOE / (Foreign-Invested Commercial Enterprise (FICE).

. Food & Beverage WFOE

Procedure:

1. Business Name Check/Registration

2. Application for Certificate of Approval

3. Application for Business License

4. Business License Police Registration

5. Make Company Chop

6. Open Bank Account

7. Capital Injection

* For Trading, Manufacturing, Food & Beverage and operating other special industries, additional approval are required from governmental bodies.

Representative Office

Representative Office is established by foreign parent companies to engage in business liaisons, quality control, product promotion, market research, exchange of technology and other permitted activities in China.

A representative office is not an independent legal entity, thus it is not allowed to directly engage in business operation activities, neither it can issue official invoices and receive payments from it's clients.

Registered Capital

No specified requirement

Required Name of Representative Office

Country/Region Name + Foreign Company Name + (in proposed district) Representative Office

How to Set Up Representative Office in China

Procedure:

1. Application for Business License

2. Business License Police Registration

3. Make Company Chop

4. Open Bank Account

* The parent company has to be over 2-year old.

Joint Venture Enterprise is commonly used mechanism for cooperative company established in China between Chinese and foreign investors. It should be two or more than two investors from different country to set up the company whose profits and losses are born jointly through cooperate management. The foreign investor shall be no less than 25% of the company’s total registered capital.

Procedure:

1. Business Name Check/Registration

2. Application for Certificate of Approval

3. Application for Business License

4. Business License Police Registration

5. Make Company Chop

6. Open Bank Account

7. Capital Injection

* For Trading, Manufacturing, Food & Beverage and operating other special industries, additional approval are required from governmental bodies.

• Types of Partnership Enterprise
• General partnership Enterprise (GPE): A general partnership enterprise may be formed by general partners who bear unlimited joint and several liability for the debts of the partnership. The general partners share unlimited liabilities for the debt of the partnership.
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• Limited partnership enterprise (LPE): A limited partnership enterprise is formed by a combination of general partners and limited partners where the limited partners bear the liabilities for the partnership's debts to the extent of their capital contributions.
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• Special General Partnership enterprise (SGPE): A special general partnership enterprise resembles a general partnership except that it must be a professional service institution offering services requiring professional knowledge and special skills. The structure shields co-partners from liabilities due to the willful misconduct or gross negligence of one partner or a group of partners. It is very similar to limited liability partnership in Europe and America.
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• Procedure:
• 1. Business Name Check/Registration
• 2. Application for Certificate of Approval
• 3. Application for Business License
• 4. Business License Police Registration
• 5. Make Company Chop
• 6. Open Bank Account
• 7. Capital Injection