Set up and run your company in mainland China

01 · ChinaMNC

Why China

China is a large and varied market, and for many foreign founders the reason to be there is proximity: to customers, to suppliers, to manufacturing partners, or to a talent pool that is hard to reach from abroad. Having a local legal entity can make it easier to sign contracts, invoice customers, hire staff, open bank accounts and hold licenses in your own name. It can also signal long-term commitment to partners and customers.

At the same time, operating in China is not a copy of operating at home. Registration is handled through government systems, and practical requirements differ by city, district and industry. Some sectors are open to foreign investment, others are restricted or require local partners, and some are closed. Founders should treat market entry as a project with legal, tax, banking and people workstreams running in parallel.

This page focuses on the practical questions founders ask first. It does not promise outcomes or timelines, and it does not replace advice from qualified local lawyers, accountants or registration agents who know your specific city and industry.

02 · ChinaMNC

WFOE, joint venture or representative office

Most foreign founders choose between three common structures. Each has different implications for control, cost, staffing and what the entity is allowed to do.

• Wholly foreign-owned enterprise (WFOE): A limited liability company owned entirely by foreign investors. It can generally conduct the business activities listed in its approved business scope, hire employees directly and invoice customers. It requires a registered address, capital contribution arrangements and ongoing accounting and tax compliance.
• Joint venture (JV): A company shared with one or more Chinese partners, typically as an equity joint venture. A JV can bring local knowledge, licenses, relationships or capital, but it also means shared control, negotiated governance and exit mechanics. It is often considered where foreign investment rules require a local partner or where the partner adds clear operational value.
• Representative office (RO): A non-profit-making liaison office. An RO is generally limited to market research, liaison and coordination activities; it cannot usually sign contracts for profit or invoice customers directly. It can suit founders who only need a presence while exploring the market.

The right choice depends on your activity, sector restrictions, who will control decisions, how you will hire and how you plan to grow. Confirm the current foreign investment rules for your industry before choosing.

03 · ChinaMNC

The five-step registration process

Registration in mainland China generally follows a sequence. The exact steps, portals and documents vary by city, so treat this as a planning outline rather than a fixed script.

• Step 1: Plan the structure. Decide on the entity type, investors, ownership, capital contribution, business scope and registered address. Check whether your industry is open, restricted or prohibited for foreign investment. Identify the government bodies involved in your city.
• Step 2: Prepare the documents. Assemble investor documents, identification, address evidence, draft articles of association and any sector-specific approvals. Foreign documents often need notarisation, apostille or consular legalisation, plus Chinese translation, depending on the requirement at the time.
• Step 3: Name and registration filing. Reserve a company name and submit the establishment filing through the local market regulation system. This typically covers company details, shareholders, officers, address and business scope.
• Step 4: Licences and post-registration items. Obtain the business licence, then handle chops (company seals), tax registration, foreign exchange registration and any industry licences your activity requires.
• Step 5: Bank, tax and hiring. Open corporate bank accounts, set up bookkeeping and tax reporting, register with the social insurance and housing fund systems if you hire, and arrange work and residence permits for foreign staff.

Each step can raise questions that affect the next, so many founders work with a local adviser from the planning stage onward.

04 · ChinaMNC

Documents to prepare

Document requirements are set by local authorities and can change. The list below covers what founders are commonly asked for when establishing a foreign-invested company. Confirm the current checklist with your local registration agent or lawyer.

• Investor identification: Passport copies for individual investors; certificate of incorporation, good standing evidence and constitutional documents for corporate investors.
• Legalisation and translation: Foreign documents are often notarised and then apostilled or consular-legalised, and translated into Chinese. Requirements depend on the document type and the issuing country.
• Registered address evidence: A lease or sublease agreement and the landlord's property documents, or documents from an approved address provider.
• Company formation documents: Proposed names, articles of association, shareholder and director details, legal representative appointment and capital contribution plan.
• Business scope wording: A description of activities using wording accepted in the local system, matched to any required licences.
• Sector approvals: Where applicable, pre-approval or filing for restricted activities, and industry licences obtained after registration.
• Officer documents: Identification and contact details for the legal representative, supervisors, directors and authorised signatories.

Keep originals, scans and translations organised, and check naming conventions for translated documents before submission.

05 · ChinaMNC

Registered address and business scope

Two items cause more delays than almost any others: the registered address and the business scope. Both are formal filing items, not informal details.

The registered address is the legal location of the company. It must generally be a real, documented premises acceptable to the local authority, and some districts restrict or scrutinise certain address types. Founders who do not yet need an office sometimes use approved address services, but the acceptability of these arrangements varies by city and by industry. Check zoning, landlord documentation and whether inspections may be required.

The business scope describes what the company may do. It is written using wording accepted by the registration system, and activities outside the scope can create compliance problems. Some activities require a licence before or after registration. Overly broad scope wording may be rejected; overly narrow wording may block future work. Consider both current and near-term activities, and review the scope when your business changes.

Both items interact with tax registration, banking and licensing, so decide them early and keep the underlying documents consistent across every filing.

06 · ChinaMNC

Banking, tax and visas

Once the company is registered, operational set-up begins. These three areas are closely linked and deserve early attention.

• Banking: Corporate bank account opening usually involves the company licence, seals, officer identification and supporting business documents. Banks apply their own onboarding and due diligence checks, and requirements differ between banks and branches. Founders should expect questions about ownership, business activity and expected transactions.
• Tax: Registration with the tax authority, invoice systems, bookkeeping, periodic filings and, where relevant, customs and foreign exchange processes. Tax treatment depends on activity, location and structure. Engage a qualified accountant early so reporting obligations are clear from the first period.
• Visas and permits: Foreign staff generally need a work permit and a residence permit to work in China, and the process typically involves the employer and local authorities. Short-term business visas do not usually permit local employment. Plan permits alongside hiring, and note that requirements and categories change over time.

Because banking, tax and immigration rules are detailed and locally applied, confirm the current requirements with professionals in your city before relying on any single source, including this page.

07 · ChinaMNC

Common mistakes to avoid

Many problems at registration and in early operations come from decisions made too quickly. These are recurring mistakes founders report, framed as cautions rather than rules.

• Choosing the entity before the activity. Decide what the company must legally do first, then check which structure and approvals allow it.
• Ignoring sector restrictions. Foreign investment rules differ by industry; assuming your sector is open can stall the project.
• Treating the address as a formality. Address documentation and acceptability are reviewed, and mismatches with leases or licences cause friction.
• Writing a vague or too-narrow business scope. Either can limit operations or trigger licensing questions later.
• Underestimating document formalities. Legalisation, apostille and translation take time; incomplete files get returned.
• Delaying tax and accounting setup. Filing obligations begin with the company, not with your first customer.
• Assuming a visa allows work. Employment generally requires the correct permit, arranged through the employer.
• Relying on one informal source. Local practice changes; confirm with qualified advisers and official channels.

Building a small team of local lawyer, accountant and registration agent early usually costs less than fixing structural problems later.