Company Registration in China is a tiresome job. If you are planning for
Company Registration in China, first you need to understand your need. Is it really necessary to
have a registered company in China, or the accumulation of an Umbrella company does
Types of Company in China:
Umbrella Company is a legal entity that works like your host in China. It looks
after your employees or operations(usually your sales/marketing/import-export or any kind of consultant)
in China. Establishing an umbrella company is cost-effective and hence the best way to start a service
sector business in China.
If you are thinking of having local employees, the umbrella company can help you in:
Following steps need to be followed for company registration:
Submit an application for company registration to the company registration authority in consent with Chinese Company Law.
Once registration is done, the entity is registered as a limited liability company or company limited by shares. But the registration might face a hindrance if the concerned authority feels that the required conditions are not fulfilled.
It is quite easy to make an inquiry on matters related to company registration from the company registration authorities.
Only the company registration authority will issue the business license to you. The date of setting up of the company and license issuing date is similar.
Following things are mentioned in the license- name, domicile, registered capital, business scope and the name of the legal representative etc of the company.
If you want to change anything mentioned in the license, you need to follow the appropriate procedure made by law. The company registration authority has the right to issue a new business license for the same.
Wholly Foreign Owned Enterprise (WFOEs) is a limited liability company. In this, the
complete shareholds the foreign entities and individuals. Only International business enterprises or
foreign individuals can be the shareholders in WFOE and a Chinese partner is not mandatory.
WFOE is the best investment vehicle if the investor is planning to manufacture, process, or assemble in China. Having paid up capital is not necessary to establish a consulting, trading or IT firm etc. in China. The foreign companies which are planning to sell or make high-value products generally prefer to a WFOE. This is to resist any violation of intellectual property that has already cast-out China,
It is the amount mandatory to operate the business until it arrives at the break-even point. A WFOE operates with the registered capital until it built up its own cash- flow.
Minimum Registered Capital Requirement
The regulations for Foreign Invested Commercial Enterprise registration are relatively
easy. It caters to the foreign investors a larger scope for administering the trading activities.
They are established for the purpose of retailing, wholesaling, franchising or trading business in
The minimum registered capital required
Representative offices betoken the parent company. They work for market research
activity to understand the scope and depth of Chinese Market for the future investment. They are not
allowed to perform any business for profit-making. They cannot sign contracts on behalf of the
parent enterprise, receive revenue, issue official tax invoices, deal a property or import
TAX on ROs
Representative officers in China are liable to pay taxes on all the expenses incurred by him. It includes staff salary and rental. Approximately 10% of the total amount is payable as the tax. They submit a monthly report to the Chinese Tax Administration Department.
Staff recruitment cannot be done by ROs themselves. They need to seek the advice of an HR agent which is appointed by the Chinese government for recruitment purposes.
Types of Joint Ventures Company:
If you are planning for company registration in China, contact us. We at LegalRaasta provide excellent services regarding company registration in China. Drop a mail at contac[email protected] or call us at +91 8750008881
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