Register and Run a Company in Mainland China

01 · ChinaMNC

Why China, and why structure matters first

China is a large, competitive market with deep manufacturing and supplier networks, a fast-moving digital consumer base, and dense clusters of talent in major cities. For many foreign founders the appeal is not one thing but proximity: being closer to suppliers, customers, partners and the engineers who build for this market.

That said, operating in mainland China is different from selling into it from abroad. If you want to hire local staff, invoice local customers in renminbi, hold a lease, or run operations on the ground, you generally need a locally registered entity. The entity you choose determines what you may legally do, how you are taxed, who controls the company, and how money moves in and out.

Decide the structure before you sign anything. Founders who pick an entity because it was quick to set up often discover later that it cannot hold the licenses, hire the people or receive the payments their business needs. Start from your actual commercial plan, then work backwards to the legal form. Confirm current rules for your city and industry with local authorities and qualified advisers.

02 · ChinaMNC

WFOE, joint venture or representative office

Three structures come up most often for foreign founders. Each has a different purpose.

• Wholly foreign-owned enterprise (WFOE): a limited liability company owned entirely by foreign investors. It can conduct the business activities listed in its approved scope, hire staff directly, and invoice customers. It is the usual choice for founders who want full control over an operating business. Setup is more involved than a representative office.
• Joint venture (JV): a company shared between foreign and Chinese investors. A JV can make sense where a local partner brings licenses, land, distribution or domain expertise you cannot easily obtain alone. The trade-off is governance: decision rights, capital contributions, profit distribution and exit mechanics all need careful drafting.
• Representative office (RO): a liaison presence. An RO is not designed to generate revenue directly; it supports market research, coordination and networking for a parent company. If you plan to invoice, hire locally or hold inventory, an RO is usually the wrong tool.

Some sectors restrict or prohibit foreign ownership, and some require additional approvals. Check the current negative list and industry-specific rules before choosing.

03 · ChinaMNC

The five-step registration process

Exact procedures differ by city and by industry, but the sequence usually looks like this.

• Step 1: Confirm feasibility and structure. Define your business activities, check whether foreign investment is permitted in your sector, choose WFOE, JV or RO, and identify the city and district where you will register.
• Step 2: Reserve the company name. Submit proposed Chinese names for approval through the local market regulation system. Names must follow local naming rules and avoid conflicts with existing registrations.
• Step 3: Prepare and file incorporation materials. This typically includes the articles of association, investor documents, legal representative appointment, registered address proof and scope of business. Foreign investor documents often need notarisation and legalisation or an equivalent process, so allow time.
• Step 4: Obtain the business licence and complete post-licence steps. After approval you receive the business licence, then arrange company seals, bank account opening, tax registration and any sector-specific permits.
• Step 5: Build ongoing compliance. Set up bookkeeping, invoicing, annual reporting and tax filing routines from day one.

Timelines vary widely with document readiness, city practice and sector approvals. Plan for iteration rather than a fixed schedule.

04 · ChinaMNC

Documents you will typically need

Document requirements are set locally and can change, so treat this as a checklist to discuss with your adviser rather than a definitive list.

• Investor identity and corporate documents: passport copies for individual investors; for corporate investors, certificate of incorporation, constitutional documents and evidence of ownership structure.
• Notarisation and legalisation: foreign documents are commonly notarised and then legalised, or handled under the applicable alternative procedure accepted by the receiving authority. Translations into Chinese are usually required.
• Company name choices: several Chinese name options in order of preference.
• Registered address proof: a lease or address-use document acceptable to the local registration authority.
• Articles of association and governance documents: setting out shareholding, capital, management and decision-making.
• Appointment documents: legal representative, directors, supervisors and possibly a company secretary, with identity documents.
• Business scope wording: drafted to match permitted activities.

Keep originals consistent across documents. Mismatched names, addresses or shareholding descriptions are a common cause of delay.

05 · ChinaMNC

Registered address and business scope

Two details cause more friction than founders expect: where the company is registered, and what it is allowed to do.

Registered address. Every company needs a registered address in the district where it is filed. This is not merely a mailing address; authorities may require documentation showing lawful use of the premises, and some districts have specific rules about what kinds of premises can host certain activities. Options include leasing commercial space, using a serviced office that supports registration, or, where local rules allow, a licensed virtual or shared address. Verify that the address can actually support your intended business and any permits you need. Changing address later is possible but adds administrative work.

Business scope. Your scope lists the activities the company may conduct, written in standard Chinese categories. Draft it around your real revenue model, not a generic template. Some activities require pre-approval or additional licences, and some are restricted to certain entity types. A scope that is too narrow can block invoicing for services you actually provide; one that is too broad can invite scrutiny. Review it as your business evolves, and amend formally when needed.

06 · ChinaMNC

Banking, tax and visas after incorporation

Incorporation is the start of operating, not the end of setup.

Banking. Open a renminbi basic deposit account for daily operations. Banks apply their own onboarding and due diligence, so expect questions about your shareholders, business model and expected flows. Keep your registration documents, leases and contracts organised. Many companies also maintain a foreign currency account for cross-border receipts and payments. Cross-border transfers are subject to foreign exchange rules and supporting documentation.

Tax. Register with the tax authority, confirm your taxpayer status, and set up invoicing. China has several tax categories, including VAT and corporate income tax, and obligations depend on your activities and status. Engage a qualified local accountant early; bookkeeping and filing deadlines are not optional, and penalties for missed filings accumulate.

Visas and work permits. Foreign staff generally need a work permit and a corresponding residence permit to work legally in China. The process usually involves the employer as sponsor and requires documented qualifications. Founders should plan their own immigration status alongside hiring. Rules differ by category and city, so confirm current requirements with local authorities before travelling or hiring.

07 · ChinaMNC

Common mistakes to avoid

Most problems foreign founders hit are preventable with a little patience.

• Choosing an entity before the business plan. Pick the structure that supports your actual revenue, hiring and licensing needs.
• Treating the business scope as boilerplate. A mismatched scope can block invoicing or trigger extra approvals later.
• Underestimating document formalities. Notarisation, legalisation and translation take time; start early and keep names and details consistent.
• Assuming a registered address is just paperwork. Confirm the premises can host your activities and any permits.
• Ignoring post-setup compliance. Annual reporting, tax filing and bookkeeping begin immediately after registration.
• Opening a bank account late. Bank due diligence can take time; prepare a clear explanation of your business and expected transactions.
• Overlooking immigration status. Working without the correct permit creates risk for both the company and the individual.
• Relying on generic advice. Rules vary by city, district and industry; verify locally.

None of this is unusual for a new market. The founders who fare best treat setup as a project with owners, documents and realistic timelines.