Incorporating a company in China is no easy task. MingTa, as a company legally incorporated in both the PRC and HK, provides various solutions to help cement your Asian dream. To open and manage a company in China it is essential to have professionals who are fluent in the language and competent in tax and legal matters.
An FIE (Foreign Invested Enterprise) is any company that is at least 25% foreign owned. The most common foreign-owned company is the WFOE, a 100% foreign-owned company: a legal ‘entity’ that is wholly owned by foreigners.
Mostly it is the LLC (Limited Liability Company) which, as a legal structure, is very similar to our Limited Liability Company, the type of WFOE used. The liability of each shareholder is limited to the capital invested in the company.
Since China joined the WTO, it is possible to establish a WFOE that deals exclusively with sales and purchases in the Asian country. These companies are a subcategory of the WFOE and are called Foreign Invested Commercial Enterprises (FICE).
MingTa will help you during the training process and advise you throughout the project. The first step is to choose the business scope in which you want to operate and determine whether it is encouraged, restricted or prohibited to foreigners.
You must also ensure that all foreign investors are approved to own shares in a Chinese company and prepare all the necessary documents to obtain the necessary government permits to operate legally in the Asian country, most of which must be drafted in Mandarin Chinese:
- The legal address of the company, including name, e-mail and telephone number of the owner of the land or building).
- The name of the company, in Chinese.
- The list of partners of the parent company
- Feasibility study
- The Articles of Association (AOA).
- The number, citizenship, salary and benefits of the employees (in case you have not yet decided who to hire, you must specify the positions);
- The name of the management structure and color copies of the passports of all interested parties.
Depending on your field of business the required documents will be different. From MingTa we will advise you on the steps to follow according to your situation. If you do not have all the documents in order, it is very likely that your application will be rejected and, after that, obtaining all the permits will be more difficult. It is necessary to request approval from the competent authorities and depending on the city or province, the documents to be submitted may vary completely.
The next step is to obtain the business license. After obtaining the certificate of approval, you will have 30 days to register with the AIC and apply for the business license. Once obtained, in order for the company to operate, you must pay the amount corresponding to the capital registered in the company’s bank account. From MingTa we always recommend leaving this work in the hands of professionals, avoiding possible complications and reserving the forces for more important tasks in your company.
