Register and run a company in mainland China

01 · ChinaMNC

Why founders look at mainland China

Founders consider mainland China for reasons that are usually practical rather than romantic. It is a large market with deep manufacturing and supplier networks, a broad pool of engineering and operational talent, and an increasingly integrated logistics base. For many businesses, being registered locally makes it easier to invoice customers, hire staff, lease premises and hold a bank account in the country where the work happens.

At the same time, mainland China is a regulated market with its own company law, foreign investment rules and tax administration. Local registration is not a shortcut around those rules; it places your business inside them. Founders who do well tend to arrive with clear answers to three questions: who is the customer, does the activity appear on the permitted list for foreign investment, and who locally will handle filings and compliance?

It also helps to decide early how much control you need and how much local partnership you want. A wholly foreign owned entity gives you control but demands full local compliance capability. A joint venture can bring market access and relationships but adds governance complexity. A representative office is narrow by design.

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). Each has a different purpose, and choosing the wrong one creates avoidable cost later.

A WFOE is a limited liability company owned by foreign investors. It can conduct the business activities listed in its approved scope, invoice customers, hire employees and remit profits subject to tax and foreign exchange rules. It is the usual choice when the founder wants control and intends to trade or deliver services locally.

A JV involves one or more Chinese partners sharing ownership. It can help where local licences, land, distribution or relationships matter, but it requires a shareholders agreement that covers governance, deadlock, exit and intellectual property clearly.

• WFOE: full foreign ownership, defined business scope, full compliance burden.
• JV: shared ownership, potential market access, more complex governance.
• RO: liaison only, cannot earn revenue directly, limited staffing.

Foreign investment is governed by a negative list that changes over time; some sectors are prohibited or restricted. Check your specific activity against the current list before choosing a structure.

03 · ChinaMNC

The five step registration process

Registration in most cities follows a similar arc, though names, portals and sequencing differ locally. The five stages below are a planning framework, not a fixed timetable.

• Step one, feasibility and structure. Confirm the activity is open to foreign investment, choose the entity type, decide the city and identify the legal representative and supervisors.
• Step two, name and scope. Reserve a company name and draft the business scope wording carefully, since it drives what you may invoice and what approvals you need.
• Step three, premises and documents. Secure a lease or registered address acceptable to the authority, then prepare and notarise or legalise investor documents as required.
• Step four, filing and licence. Submit the establishment filing through the local market regulation system, obtain the business licence, then complete seals, bank account and tax registration.
• Step five, operations. Set up accounting, invoicing, payroll and foreign exchange processes, and arrange visas for foreign staff.

Some activities require sector-specific approval before or after the licence, such as food, education, logistics or financial services. Build that into your plan rather than discovering it at the counter.

04 · ChinaMNC

Documents founders usually need

The document list varies by city, entity type and industry, but the core set is fairly consistent. Preparing clean, consistent paperwork is one of the few things fully within your control, and messy documents are a common cause of delay.

• Investor identity: passports for individual shareholders and directors; for corporate shareholders, certificate of incorporation, constitutional documents and a register of directors or members.
• Proof of address: utility bills or bank statements for individuals, and registered office evidence for companies.
• Corporate authorisation: board resolutions approving the investment and appointing the authorised signatory.
• Legalisation: notarisation and consular legalisation or apostille where accepted, plus certified translations into Chinese.
• Premises: lease agreement and landlord ownership evidence for the registered address.
• Local appointments: legal representative, supervisor, finance contact and, where required, a local liaison.

Keep names, addresses and dates identical across every document. Where a document is in a language other than Chinese, expect to supply a translation. Ask the local authority or your adviser for the current checklist for your city before you start collecting signatures.

05 · ChinaMNC

Registered address and business scope

Two details shape how easily a new company can operate: where it is registered and what it is allowed to do.

The registered address is the legal location of the company. It must be a real, documented premises acceptable to the local authority, evidenced by a lease and the landlord's ownership documents. Some cities permit serviced or virtual registered addresses for certain activities, while others require actual office space, and some industries demand inspections. Choose an address that matches your real operations and can receive official mail. Changing it later is possible but adds filings and cost.

Business scope is the formal description of permitted activities. Write it to cover what you will actually do, in the standard wording the local system expects, without padding it with activities you cannot support. Scope affects invoicing, tax treatment, licensing and sometimes the ability to open a bank account. If you plan to add services later, check whether an amendment is needed.

Before signing a lease, confirm the address can be used for company registration and that the intended scope is acceptable there. Landlords sometimes assume this is automatic; it is not.

06 · ChinaMNC

Banking, tax and visas after the licence

Receiving the business licence is the midpoint, not the finish. The operational setup that follows determines whether the company can actually trade.

Banking. Open a corporate renminbi account and, where needed, a foreign currency account. Banks apply their own due diligence, so expect questions about shareholders, business model and expected flows, and bring the licence, seals, identity documents and lease. Approval is not guaranteed and can take time, so do not promise customers a payment date before the account is live.

Tax. Complete tax registration, confirm the taxes that apply to your activity, and set up invoicing and bookkeeping. Mainland China uses invoice-based systems, so your finance process must be designed around them. Engage a qualified local accountant early; tax obligations continue even when you have no revenue.

Visas. Foreign staff usually need a work permit and a residence permit, and the employer must be properly registered to sponsor them. Plan the sequence with your local adviser, since the order of approvals matters.

Ongoing compliance. Annual reporting, accounting, labour and foreign exchange rules all continue after launch.

07 · ChinaMNC

Common mistakes foreign founders make

Most problems we see are avoidable with a little patience at the start.

• Choosing the entity before the activity. Confirm that the planned business is open to foreign investment and that the scope wording supports it, before incorporating.
• Treating the licence as the finish line. Banking, tax registration, invoicing and visas each take effort and can gate revenue.
• Signing a lease without checking registration use. A premises that cannot host a company or support your scope wastes rent and time.
• Inconsistent documents. Mismatched names, addresses or signatures across notarised papers cause rejection and rework.
• Underestimating local finance. Invoice systems, payroll and tax filings need a capable local accountant from day one.
• Ignoring intellectual property. Register trademarks and protect know-how before hiring and sharing materials.
• Assuming one city equals another. Procedures and requirements differ across jurisdictions; use local advice.
• No exit plan. Governance, deadlock and transfer provisions belong in the founding documents, especially in a JV.

None of this is unusual for a regulated market. It simply needs planning, not optimism.