Establish your business in China with the right structure from the start.

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Setting up in China starts with a few practical questions. Can you own the business outright? How much funding will you need? What licences are required? Can you and your employees work here? What must the company do each year?

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OPING helps you answer these questions and turn your plans into an operating business. Since 2002, we have supported foreign companies and individuals with company formation, legal and tax matters, accounting, employment and ongoing compliance.

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1. Start with what you want to do in China

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Before choosing a company structure, we look at how your business will work.

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Will you sell products or provide services? Invoice customers in China? Hire a local team? Bring foreign managers to Shanghai? Import goods or receive funding from an overseas parent?

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Your answers determine the appropriate structure, business scope, licences and funding arrangements. We also consider how your China operation will connect with your overseas business.

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Can you own the company outright?

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In many sectors, yes. You do not automatically need a Chinese partner.

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China’s Foreign Investment Negative List identifies activities that are closed to foreign investors or subject to conditions, such as limits on foreign ownership. Activities outside this list generally receive the same market-access treatment as Chinese investment.

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However, being open to foreign investment does not mean an activity is free from regulation. China also has market-access rules for all businesses, and some activities require specific licences or approvals. We check both sets of requirements against your plans.

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2. Choose the right business structure

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For most clients, the choice is between three main options.

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A wholly foreign-owned company
Usually suitable when you want to operate a business, hire employees, sign contracts, invoice customers, and earn revenue in China, while retaining foreign ownership and control.

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A joint venture with a Chinese partner
Suitable when a local partner adds commercial value or sector rules require Chinese participation. We help clarify who contributes what, how decisions are made, how profits are shared, and what happens if either party wants to leave.

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A representative office
Suitable for a limited presence focused on liaison, market research, and promotion. It generally cannot earn revenue directly and still has tax, reporting, and employment requirements.

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Why you may hear different names for these structures

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China previously had separate laws for wholly foreign-owned enterprises and different types of joint ventures. The Foreign Investment Law, effective January 1, 2020, replaced them with a unified framework. Foreign-invested companies now follow the Company Law for their organisation and governance.

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The term “WFOE” is still commonly used to describe a wholly foreign-owned enterprise. It remains a useful business description, although the underlying legal framework has changed.

 

Existing foreign-invested enterprises had until December 31, 2024, to make the necessary governance adjustments. If your company was established under the earlier rules, we can review whether its articles of association and management arrangements have been properly updated.

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3. Plan how to fund the business

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Registered capital is the amount shareholders commit to contribute to the company. It should reflect your expected costs and funding needs, including premises, salaries, and the period before the business generates sufficient income.

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Under the revised Company Law, effective July 1, 2024, shareholders of newly established limited liability companies generally must contribute their registered capital within five years of incorporation.

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For older limited liability companies, the transition works differently:

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• If the company was established before July 1, 2024, and its contribution deadline extends beyond June 30, 2032, it generally must revise that timetable by June 30, 2027.

• The revised deadline must generally fall no later than June 30, 2032.

• An earlier compliant contribution deadline continues to apply; the transition does not automatically extend it.

 

The 2027 deadline is for adjusting the timetable where necessary—not for every existing company to pay all its capital. Specific exceptions and sector rules may apply.

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OPING helps you choose a realistic capital amount, plan contributions, and assess how overseas funding should reach the China business.

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4. Register the company and prepare it to operate

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Once the structure and funding are clear, we coordinate the setup.

 

This includes:

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• Company registration: the name, business scope, registered address, shareholder documents and management appointments.

• Licences and approvals: any additional permissions required for your activities.

• Company seals, or “chops”: arranging the necessary seals and establishing who can use them.

• Bank accounts: preparing the documents and coordinating the bank’s verification procedures.

• Tax and invoicing: setting up tax and accounting arrangements and the ability to issue official Chinese tax invoices, known as fapiao.

• Import and export arrangements: customs registration and relevant product requirements, where needed.

 

The sequence matters. For example, premises may need to meet specific licensing conditions before you can operate there. We identify these requirements early so you can make informed commitments.

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5. Arrange the right to work and live in China

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For foreign founders, managers, and employees, immigration planning should begin alongside company setup.

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Owning a Chinese company does not automatically give you permission to work in China.

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For a typical long-term hire coming from overseas, the process generally has three stages:

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1. Work approval: the Chinese employer applies for a Notification Letter of Foreigner’s Work Permit.

2. Entry visa: the employee normally uses this notification to apply for a Z visa, commonly called a work visa.

3. Work and residence formalities: after arrival, the required work permit procedures and application for a work-type residence permit are completed. A standard Z-visa holder generally must apply for the residence permit within 30 days of entry.

 

These documents serve different purposes: the visa allows entry for work, the work permit authorises employment, and the residence permit allows the person to live in China for the approved period. Some eligible applicants can follow an in-country application route.

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OPING helps assess eligibility, prepare documents and coordinate applications, renewals and employer changes. We also assist with accompanying family members’ visa and residence arrangements.

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Requirements depend on the applicant and role and may include qualifications, work experience, a criminal record certificate, health documentation and an employment agreement.

 

A business visa or visa-free business visit does not itself authorise employment.

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6. Keep the business running properly

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Once your company is established, certain obligations continue throughout the year. We help you understand what applies, keep track of deadlines, and coordinate the work.

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Accounting and tax
Bookkeeping, financial statements, regular tax filings, annual corporate income tax reconciliation, and audit coordination.

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Annual reporting and company records
Annual corporate and foreign investment reports, relevant ownership disclosures, and updates when shareholders, directors, capital, address, or business scope change. Annual enterprise reporting generally runs from January 1 to June 30 for the preceding year.

 

Employees and payroll
Employment contracts, payroll, income tax withholding, social insurance, applicable housing fund contributions and foreign employees’ permit renewals.

 

Payments between China and overseas
Supporting documents and procedures for overseas payments, shareholder funding and profit remittances, together with related-party reporting and transfer pricing documentation where required.

 

Licences and business-specific obligations
Licence renewals and relevant customs, product, data protection and other regulatory requirements. The foreign investment framework expressly requires compliance with tax, accounting, employment, social insurance and foreign exchange rules.

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Our support continues beyond incorporation, with a clear compliance calendar and a central point of contact.

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7. Adapt as your business develops

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As your business grows, you may need a different structure, additional activities, new shareholders or more funding.

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OPING can help with these changes and assess eligibility for R&D deductions, high-tech enterprise status and other relevant incentives. Where a business needs to restructure or close, we coordinate the legal, tax, employment and registration steps involved.

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Talk to us about your plans

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You do not need to arrive with every answer. Tell us what you want to do in China, who will be involved, and how you expect the business to operate.

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We will help you understand the options, identify the requirements, and plan the next steps.

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Contact OPING for a free initial consultation.

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