Start and run your company in mainland China

01 · ChinaMNC

Why consider mainland China

Mainland China remains one of the world's largest markets for many products and services, and it has a deep supplier and manufacturing base. For many foreign founders the appeal is not one single factor but the combination: proximity to manufacturing clusters, a large domestic customer base, and an increasingly integrated logistics and digital payments environment.

At the same time, operating locally is different from exporting into the market. A locally registered company can make it easier to hire staff, invoice customers in renminbi, sign contracts with local partners, and hold the licences some activities require. It also brings obligations: bookkeeping, tax filings, statutory reporting and compliance with local rules.

Before committing, be clear about what you actually need. Some founders only need a sourcing presence; others need to sell, hire and invoice locally. Your answer changes the entity type, the capital you set, and the licences you must obtain. A short written plan of your first two years of activity will make every later decision easier.

02 · ChinaMNC

WFOE, joint venture or representative office

The three structures foreign founders most often compare are the wholly foreign-owned enterprise (WFOE), the joint venture (JV) and the representative office (RO).

• WFOE: a limited liability company owned entirely by foreign investors. It can typically conduct the business activities listed in its approved scope, hire employees and invoice customers. It requires registered capital and a registered address, and it must maintain books and file taxes.
• Joint venture: a company shared with one or more Chinese or foreign partners. A JV can open doors to local knowledge, licences or distribution, but it also means shared control, negotiated governance and a clear exit mechanism. Put the partnership terms in writing before you register anything.
• Representative office: a liaison office that cannot usually earn revenue directly. It suits market research or coordination, not selling or invoicing. It is simpler in some respects but limited in what it can do.

Choose based on activity, control and risk, not on which structure sounds cheapest. Confirm current rules for your specific sector with a local adviser, because restricted and prohibited activities exist and change over time.

03 · ChinaMNC

The five-step registration process

Registration in mainland China generally follows a sequence. Exact requirements and handling times vary by city and by industry, so treat this as an outline rather than a schedule.

• Step 1 — Plan and check. Define your business activities, estimate registered capital, choose a city, and check whether your sector is permitted, restricted or requires a pre-approval licence.
• Step 2 — Name and address. Reserve a company name and secure a registered address that can be used for registration and official mail. Landlords usually provide supporting documents.
• Step 3 — Prepare and submit documents. Articles of association, investor documents, appointment of legal representative and supervisors, and address evidence are typically among the filings.
• Step 4 — Business licence and seals. After approval you receive the business licence, then arrange the company seals, which are used for contracts, banking and filings.
• Step 5 — Post-setup registrations. Open a bank account, complete tax registration, set up bookkeeping, and arrange work permits and visas for foreign staff as needed.

Plan for document legalisation or notarisation where required, and keep copies of everything.

04 · ChinaMNC

Documents foreign founders usually need

Document lists differ by city, entity type and industry, but foreign founders commonly prepare the following.

• Investor documents: certificate of incorporation or equivalent for a corporate shareholder, or passport for an individual investor, often notarised and legalised or apostilled depending on the jurisdiction.
• Company name choices: several alternatives in Chinese, with a proposed English name.
• Articles of association: the constitutional document setting out capital, governance, profit distribution and shareholders' rights.
• Registered address evidence: lease or ownership documents and landlord consent for registration.
• Appointments: legal representative, supervisors, and authorised signatories, with identity documents.
• Business scope wording: standard descriptions of the activities you intend to conduct.
• Capital and funding evidence: information on registered capital and how it will be contributed.

Translations may be required. Because formalities and acceptance practices vary, confirm the current list with the local registration authority or your adviser before submitting, and allow time for document preparation abroad.

05 · ChinaMNC

Registered address, business scope and capital

Three items shape what your company can do and where it can do it.

Registered address. Every company needs a registered address, which appears on the licence and is used for official correspondence. It is not always the same as your operating office. Some cities allow shared or incubator addresses for certain activities; others require commercial premises. Check that the address is eligible for your business scope and that the landlord will support registration.

Business scope. This is the formal description of permitted activities. Write it to match your real plans, including planned future lines where sensible, but do not pad it with activities you will not perform. Some activities require a separate licence before you can start; confirm this before you commit to a location or lease.

Registered capital. This is the amount shareholders commit to contribute. It signals seriousness and affects liability, and contribution rules apply. Set an amount you can realistically fund rather than the largest figure you can write down.

06 · ChinaMNC

Banking, tax and visas after incorporation

Once the business licence is issued, the operational work begins.

Banking. Open a corporate renminbi account and, if needed, a foreign currency account. Banks carry out their own onboarding and due diligence, so expect questions about shareholders, expected transactions and business substance. Prepare consistent explanations and documents.

Tax and accounting. Complete tax registration and set up bookkeeping from day one. A locally qualified accountant or bookkeeping firm can handle monthly or quarterly filings, invoices and annual reporting. Understand the main taxes that may apply to your activity, and keep records that support what you file.

Visas and work permits. Foreign employees generally need a work permit and a corresponding residence permit to work legally. Procedures and eligibility categories differ, and applications usually require the company to be established first. Family members may have separate options. Start early, because timing depends on appointments and document checks rather than on your own schedule.

Build a simple compliance calendar covering filings, renewals and reporting deadlines.

07 · ChinaMNC

Common mistakes to avoid

Most problems foreign founders encounter are avoidable with a little foresight.

• Choosing the entity before the plan. Decide what you will actually do — sell, manufacture, hire, hold IP — and let that drive the structure.
• Overstating registered capital. A large number creates a funding obligation. Choose an amount you can meet.
• Ignoring licensing. Some activities need pre-approval. Discovering this after signing a lease is expensive.
• Thin business substance. Banks and authorities expect a real operation: premises, staff, records, and coherent explanations of your activity.
• Skipping the bookkeeping habit. Late or missing filings create penalties and friction later.
• Vague JV terms. Governance, deadlock, transfer and exit should be written down and reviewed by local counsel.
• Treating visas as an afterthought. Foreign staff cannot legally work before permits are in place.

Get local professional advice on your specific structure, sector and city before you commit money.