How to register a WFOE in Beijing and what are the advantages?

After signing an agreement with our clients for WFOE registration in China, we issue a formal invoice. At this stage, we anticipate that our clients will make a payment for the service, allowing us to commence the process.

Upon receiving full payment for the WFOE registration, we provide our clients with a detailed questionnaire. This document requests all the necessary information about the company, business activity, founders (shareholders), and executives (including the company director and supervisor). We request that our clients complete the questionnaire and return it to us via email.

1. Company Name Choices: In China, WFOE names should follow this structure: [Place of Registration] + [Chosen Name] + [Business Direction] + Co., LTD. For example, Shanghai Silk Road International Trading Co., LTD, or for a consultancy company: Shanghai Silk Road Consulting Co., LTD. An alternative structure is: [Chosen Name] + [(Place of Registration)] + [Business Direction] + Co., LTD. For example: Silk Road (Shanghai) International Trading Co., LTD. Please note, in China, a company’s Chinese name is considered its main name. If our clients know Chinese, we ask for name choices in both Chinese and English, following the above structure. If not, English name choices will suffice, and we will select a corresponding Chinese name based on similar sounds. Avoid city, country, and historical names, as they’re typically disallowed. Also, we discourage direct translations of the English name due to high likelihood of them being taken. We recommend selecting similar-sounding Chinese characters to avoid delays. The Chinese name does not need to have a specific meaning, as meaningful characters are often taken.

2. Company’s Legal Person (Company Director): The legal person is an individual and cannot be a corporate entity. Please prepare their full name (as on the passport), a copy of their passport (not ID), along with their address, phone number, and email address.

3. Company’s Supervisor: The company supervisor is a separate individual from the company director, meaning they cannot be the same person. Please provide their full name (as on the passport), a copy of their passport (not ID), and their address, phone number, and email address.

4. Company’s Shareholder(s): Shareholders are the owners of the company and can be both individuals or corporate entities. Both the company director and supervisor can be shareholders. There can be up to 50 shareholders. Whether an individual or corporate shareholder, full information is required: full names, contact details, address, and either passport copies (for individual shareholders) or a full set of company documents (for corporate shareholders).

5. Company’s Business Activity: What products and/or services does the company plan to sell? Please prepare a detailed list.

6. Company’s Registered Capital: The registered capital is the amount the founders plan to invest in the company over a span of 30 years or more. The amount varies depending on the activity and place of registration. We recommend $300,000 for international trading companies and $100,000 for consultancy companies, as examples. The registered capital amount is usually suggested by the local government.

7. Full Contact Details for All Involved Executives and Shareholders: We need the complete contact details for all executives and shareholders. This includes addresses, emails, and phone numbers.

Once we receive the completed WFOE registration questionnaire, we review it carefully and follow up with our clients accordingly. If there’s any missing information, or if the company requires additional permits or licenses based on its planned products or services, we will inform the client. If everything is in order, we prepare the application documents, attach our clients’ documentation, and submit the WFOE registration application. The estimated waiting period for feedback from the government on the registration application is approximately 10 business days. Please note that timeframes in China are approximate due to government bureaucracy.

Once the WFOE registration application is submitted, the government generally responds within 10 business days. If approved, they will issue the company’s structural documents, which the founders (shareholders) and executives (director and supervisor) are required to sign with a black gel pen and mail back to us (Note: In China, only black gel pens are acceptable for signing legal documents; other colors and ballpoint pens are not accepted). We then submit the signed documents to the company registrar and await the business license. The waiting period for the business license is roughly 10 business days unless expedited service was purchased. With expedited service, a business license can be obtained within 2-5 business days. Contact us for more details about the expedited service.

Once we secure the WFOE business license, we will contact our clients and the bank to schedule an appointment to open a corporate bank account for the company. Please note, the company director must be present in China to open a corporate bank account and their citizenship should not be among the countries sanctioned in the bank’s system. Alongside being present, the director needs to provide a Chinese phone number linked to their passport and a second person’s passport and phone number linked to this second person’s passport. This second person can be anyone in China (provided their citizenship isn’t among the sanctioned countries) with a Chinese phone number. This requirement is due to the banks’ need to issue online banking devices that require two people’s information. Legally speaking, this second person doesn’t have any rights or obligations regarding the company’s finances or bank account. While this might seem unusual, it remains a requirement, so we advise clients to identify such an individual in China before opening a bank account. The bank account opening process takes around 5-6 hours, and we recommend our clients exercise patience during this process.

After your WFOE bank account is opened, we’ll proceed to contact the customs department to initiate the process for the e-port device (if you’re registering an international trading WFOE focused on import/export. Note that e-port isn’t required for consultancy or other types of companies). This process typically takes about 5 business days, and we’ll mail the e-port device to our clients once it’s secured.

Yes, following the acquisition of the e-port for the WFOE, we’ll register the company with the tax department. This process generally takes around 14 business days, and it requires the company director to visit the tax office in person for ID verification.

Indeed, the final step in the WFOE registration is the foreign currency permission application. This process typically takes around 7 business days and necessitates a visit to the relevant government department. After securing the foreign currency permission, the WFOE can commence its operations.

On the whole, the complete process for WFOE registration can span anywhere between 4 and 8 weeks. As we mentioned earlier, all timeframes are approximations due to the inherent unpredictability of government bureaucracy. Although these factors are beyond our control, we will do our absolute best to expedite the process.

A WFOE is a company in China fully owned by foreign investors, providing complete control over business operations, without the need for a Chinese partner.

As China’s capital, Beijing is a significant political, educational, and cultural center. It has a vibrant economy with opportunities in tech, finance, and various other sectors.

A WFOE allows full control over your business operations, profit retention, and better protection for your intellectual property rights.

JR & Firm provides a comprehensive suite of services including company setup, business license application, and guidance in legal and compliance matters.

As of 2014, China has removed the minimum registered capital requirement for WFOEs, but investors must be able to fund their business plans.

Beijing is very welcoming towards foreign businesses and offers a supportive environment with established infrastructure and a skilled labor force.

Yes, a WFOE can hire foreign employees, but they must comply with Chinese labor laws and visa regulations.

Business registration in Beijing involves several steps, including obtaining name approval, business license, and tax registration. Companies like JR & Firm can help guide you through this process.

Beijing businesses are subject to several taxes including corporate income tax, value-added tax, and others. The exact tax obligations depend on your business activities.

Yes, a foreigner can serve as the legal representative (managing director) of a WFOE.

The legal representative acts on behalf of the WFOE in legal matters and is responsible for the company’s operations.

Registering a WFOE can offer enhanced control to safeguard your business assets, but it’s also crucial to register trademarks, patents, and copyrights with the Chinese authorities.

Yes, JR & Firm can provide expert advice on Chinese tax laws, assist in tax registration, planning and ensure compliance.

Dissolving a WFOE involves several steps including ceasing business operations, paying off debts, disposing of assets, and deregistration. Legal assistance is recommended.

Yes, a WFOE can invest in other Chinese companies, but this may be subject to specific regulations and restrictions.

You can hire directly or through recruitment agencies. It’s important to follow local labor laws for contracts, benefits, and insurances.

Yes, JR & Firm offers HR consultancy services including drafting of employment contracts, advising on labor law compliance, and managing employment disputes.

Challenges can include understanding local business culture, navigating regulatory systems, language barriers, and protecting IP rights. JR & Firm’s services can help address these challenges.

Registering your IP rights with the appropriate Chinese authorities is key. JR & Firm can guide you through this process.

Yes, foreigners can own property in Beijing with some restrictions. It’s advisable to seek local legal advice before proceeding.

Yes, JR & Firm has expertise in managing business disputes and can provide legal representation in both litigation and arbitration proceedings.

While local partners can offer valuable insights and connections, a WFOE structure allows you to operate independently.

You can use a foreign account for some transactions, but generally, it’s advisable to open a local bank account for Chinese operations.

Yes, JR & Firm’s services include contract drafting, reviewing, and negotiation, ensuring your contracts are compliant with Chinese laws and protect your business interests.

Compliance can be complex given the evolving regulatory landscape. Working with JR & Firm ensures you remain updated and compliant.

Sectors like technology, finance, healthcare, and education are promising. However, thorough market analysis is advised for your specific industry.

Yes, JR & Firm offers business consultancy services, including strategic advice tailored to your specific business needs in the Beijing market.

The closure of a business involves legal procedures such as liquidation and de-registration. JR & Firm can guide you through the process to ensure legal compliance and minimize liabilities.