Types of Companies in China

Types of Companies in China

Updated on Thursday 21st September 2017

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NameBusinessmen or foreign investors who wish to open a company in China can be advised and legally counseled by our Chinese lawyers who can offer detailed information and guidance about the entire process. Among the preferred types of companies in China, investors choose to open a Partnership Enterprise (PE), a Joint Venture (JV), a Wholly Foreign Owned Enterprise (WFOE), a State-Owned Enterprise (SOE), a Private Enterprise (PE). You can also choose to open a Representative Office (RO) in China.

Details about a WFOE (Wholly Foreign Owned Enterprise) in China

WFOE (Wholly Foreign Owned Enterprise) is a limited liability company, entirely owned by a foreign investor, and one of the most agreed types of companies in China. To open such company, the investor or the representative of the company needs to prepare the incorporation certificate, Articles of Association with the approval of the Chinese Consulate, bank statements, details about the registered capital, information about the operational structure, the VAT certificate, the import and export licence,  and the registered name with SAIC (State Administration of Industry and Commerce. Also, the Ministry of Commerce and Foreign Economical Cooperation Bureau in China will grant the approval certificate, in order to start your business.

Details about a JV (Joint Venture) in China

A Chinese Joint Venture is created between an overseas investor and a Chinese enterprise or individual, with both investment contributions and shared profits. Chinese and foreign parts need to settle for the control and the activities of the company, due to specific terms, rules and regulations. This type of company allows a foreign investor to easily enter the Chinese market and make profitable activities. Our  lawyer in China can provide you with information and details about a Joint Venture in China and about how to register one.

Details about a PE (Partnership Enterprise) in China

A Partnership Enterprise has the same characteristics as JV in China, where persons can do business in different domains in the country. In order to open such company in China, you will need to register with the Trade Register in China, without needing the Ministry of Commerce endorsement. The best part is that a Partnership Enterprise is not obliged to pay the income tax, and there is no need to provide a minimum share capital in order to open this type of company.

Details about an RO (Representative Office) in China

If you are interested in market research, maintain business relations, present products on the Chinese market and to develop new commercial associations, then you should open a Representative Office. It is good to know that this kind of business cannot perform any commercial activity. A Chinese Representative Office can speak in the name of the parent company and can promote and introduce its products to the market.
For a better understanding of the rules and regulations related to the registration and the proper function of different types of companies in the country, you are invited to contact our law firm in China.


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