Register and run a company in mainland China

01 · ChinaMNC

Why China

Foreign founders usually look at mainland China for three reasons: proximity to large manufacturing and supplier networks, access to a deep consumer and business market, and the chance to build local teams and distribution rather than serving customers remotely. A local entity can make it easier to sign contracts, invoice customers, hire staff, open bank accounts and hold licenses that foreign companies cannot always obtain from abroad.

It is also a market that rewards preparation. Registration is procedural, but operating is not: you will deal with local accounting and tax filings, labor rules, invoicing systems and, in many sectors, licensing. Founders who succeed tend to treat China entry as a multi-year commitment with a clear local owner, not as a one-off paperwork exercise.

• Market access: a local company can contract, invoice and hire in China.
• Supply chain: closer coordination with suppliers and quality control.
• Talent: hiring local sales, operations and support staff.
• Commitment: plan for ongoing compliance, not just registration.

Before choosing a structure, define what the China entity must actually do in its first year. That answer drives the entity type, the business scope and the staffing plan.

02 · ChinaMNC

WFOE, JV or RO

Foreign founders in mainland China generally choose among three structures. A wholly foreign-owned enterprise (WFOE) is a limited liability company owned entirely by foreign investors. It is the most common choice for founders who want to control operations, hire staff, invoice customers and hold revenue directly. A joint venture (JV) brings in a Chinese partner, which can help with licenses, land, distribution or local relationships, but it requires careful agreement on governance, capital, profit sharing and exit.

A representative office (RO) is a liaison office. It cannot earn revenue directly and is limited in what it can do, so it suits market research or coordination rather than full commercial operations. Some sectors restrict or cap foreign ownership, which may make a JV necessary; others are open to full foreign ownership.

• WFOE: full control, direct revenue, most flexible for most service and trading businesses.
• JV: local partner, useful where access or licensing depends on a Chinese shareholder.
• RO: liaison only, no direct revenue, limited staffing and activity.

Check the current negative list for your industry before deciding, and confirm capital and licensing requirements for your city.

03 · ChinaMNC

The five-step process

Registration in mainland China generally follows five stages. Exact sequencing and timing vary by city, district and industry, and some sectors require pre-approval, so treat this as a planning framework rather than a fixed schedule.

• 1. Plan and check: confirm the entity type, industry restrictions, business scope, registered capital and whether any sector license is needed before you file anything.
• 2. Reserve the name and prepare documents: submit the company name for approval and assemble the charter, investor documents, passport copies and address evidence.
• 3. File for the business license: submit the registration application to the local market regulator; once approved, the business license is issued.
• 4. Complete post-license steps: have seals made, open the bank account, register with the tax authority, and set up invoicing and accounting.
• 5. Staff and operate: register employees, arrange work permits and residence permits for foreign staff, and put recurring filings on a calendar.

Each stage depends on the one before it, so delays in documents or address paperwork ripple through the whole plan. Line up a local accountant and, where needed, a lawyer early.

04 · ChinaMNC

Documents you will need

Document requirements vary by city and by entity type, but most foreign founders should expect to prepare the following. Originals or notarized and legalized copies are often requested for foreign investor documents, and translations may be needed.

• Investor documents: certificate of incorporation or equivalent for a corporate shareholder, or passport for an individual investor.
• Notarization and legalization: foreign documents often need notarization and consular legalization or an apostille, depending on the source country and current practice.
• Identity and contact details: passports of directors, supervisors, legal representative and authorized signatories.
• Registered address evidence: lease agreement and property ownership documents for the proposed office.
• Company charter: articles of association covering governance, capital and profit distribution.
• Name reservation: proposed company names, usually several options.
• Sector-specific papers: licenses, approvals or qualifications if your industry requires them.

Keep a single, shared document checklist with owners and deadlines. Missing or inconsistent paperwork is one of the most common causes of delay, and small mismatches in names or addresses can send a file back for revision.

05 · ChinaMNC

Registered address and business scope

Every mainland company needs a registered address, and the address must generally be a real, documented premises acceptable to the local authority. Many cities allow serviced offices or incubator addresses for certain activities, but rules differ by district and by industry, and some sectors require a physical site with inspection. Confirm what your district accepts before signing a lease, and keep the lease, ownership certificate and any filing documents consistent.

Business scope defines what the company may do. It is written in standard categories, and certain activities require a license or permit before they can be included or operated. Draft it to match your actual near-term plan rather than a maximal list; an overly broad scope can raise questions, while a scope that is too narrow can block invoicing for services you intend to sell.

• Address: documented, district-acceptable, consistent with your lease.
• Scope: standard categories, matched to real activities.
• Licensing: identify permitted activities that need approval.
• Changes: address and scope changes require filings, so plan ahead.

If you expect to expand activities later, ask your local adviser how easily the scope can be amended.

06 · ChinaMNC

Banking, tax and visas

After the business license is issued, the company needs a bank account and tax registration before it can operate normally. Bank onboarding involves know-your-customer checks on the company, its shareholders and signatories, and banks may ask for business evidence such as contracts or a business plan. Expect the process to take time and prepare clear documentation.

On tax, a new company typically registers with the tax authority and must keep proper books, issue invoices through the official system and file returns on the required schedule, even when there is no revenue. Corporate income tax, value-added tax and withholding obligations depend on your activities, so agree an accounting arrangement early rather than catching up later.

• Bank account: prepare KYC documents, ownership details and business rationale.
• Tax registration: confirm filings, invoicing and bookkeeping duties.
• Foreign staff: work permits and residence permits are usually required.
• Local hires: employment contracts and social insurance registration.

Visa and permit rules change, and eligibility depends on the role, qualifications and city. Check current requirements with the local authorities or a qualified adviser before staff relocate.

07 · ChinaMNC

Common mistakes

Most problems foreign founders hit in China are avoidable with a little discipline. The recurring themes are preparation, consistency and treating compliance as ongoing work rather than a one-time event.

• Choosing the entity before the plan: pick the structure after you know what the company must do, who owns it and how it will earn revenue.
• Ignoring sector restrictions: check foreign ownership limits and licensing before committing to a structure or lease.
• Weak address paperwork: an address the district will not accept, or documents that do not match, stalls registration.
• Copy-paste business scope: a scope that does not fit your activities can block invoicing or trigger questions.
• Underestimating banking: arriving without clear ownership and business evidence slows account opening.
• Forgetting post-setup compliance: missed filings, bookkeeping gaps and lapsed permits create risk.
• No local owner: a China entity needs someone accountable for documents, deadlines and authorities.

Budget for professional support in accounting, legal and HR, and revisit your structure as the business grows. Good planning at the start is usually cheaper than fixing problems later.