Set up and operate your company in mainland China

01 · ChinaMNC

Why China, and why now

China is one of the largest consumer and industrial markets in the world, and many foreign founders want more than an exporter relationship. A local entity lets you hire staff, invoice customers in the domestic market, hold a local bank account, and manage suppliers and partners directly.

That said, scale is not a reason on its own. A mainland company makes most sense when you have a clear customer segment, a product or service that fits local demand, and someone who can run operations on the ground. Founders often start by testing demand through distributors or e-commerce, then formalise once the model is proven.

China also moves quickly on regulation, data, and tax. Building a local team that includes accountants, a corporate lawyer, and a reliable local partner reduces the risk of surprises. Treat market entry as a multi-year commitment rather than a single filing, and plan for localisation of product, pricing, and support.

This page focuses on the practical path: choosing a structure, preparing documents, and running the company after registration. Use it as a map, then validate each step in the city where you plan to operate.

02 · ChinaMNC

WFOE, joint venture or representative office

The three structures foreign founders most often consider are the wholly foreign-owned enterprise (WFOE), the joint venture (JV), and the representative office (RO). Each fits a different stage and purpose.

• WFOE: A limited liability company owned entirely by foreign investors. It can hire staff, sign contracts, invoice customers and hold a bank account. It is the usual choice for founders who want full control of an operating business.
• Joint venture: A company shared with one or more Chinese or foreign partners. A JV can bring local market access, licences or relationships, but it also means shared control and governance. The shareholder agreement matters as much as the registration.
• Representative office: A liaison office that cannot earn revenue directly. It suits market research and coordination, not sales or hiring at scale. Many founders use an RO to explore, then upgrade to a WFOE.

Choose based on what you need to do in year one, not on the smallest filing fee. A structure that cannot invoice or hire will cost more in workarounds than it saves.

03 · ChinaMNC

The five-step setup process

Exact procedures and timing differ by city, but most mainland registrations follow a similar path.

• Step 1: Plan the business. Define activities, target customers, staffing and budget. Decide the entity type, city and whether you need special licences for your sector.
• Step 2: Reserve the name and prepare documents. Check name availability with the local market regulator, then prepare the articles, investor documents and identification papers. Foreign documents usually need notarisation and legalisation or apostille, depending on the source country.
• Step 3: Register the company. Submit the application to the market regulator, obtain the business licence, and complete the company seal set. Register with tax, social insurance and other required authorities.
• Step 4: Open bank and set up systems. Open the corporate bank account, register for invoicing, and set up accounting and payroll. Foreign exchange registration is part of this stage.
• Step 5: Go live and stay compliant. Hire staff, sign leases and contracts, and set up recurring filings. Bookkeeping, annual reporting and tax deadlines are ongoing obligations, not one-off tasks.

Build a checklist with your local adviser and track each item to completion.

04 · ChinaMNC

Documents you will need

Paperwork is where most delays begin, so prepare early and check requirements for your specific city and sector.

• Investor documents: Certificate of incorporation or equivalent, articles, and a register of directors or shareholders for corporate investors. Individuals typically provide passports.
• Notarisation and legalisation: Foreign documents usually need notarisation and either consular legalisation or an apostille, depending on the country. Translations into Chinese are commonly required.
• Company details: Proposed name, registered address, business scope, registered capital, and the legal representative's details.
• Governance documents: Articles of association, shareholder resolutions, and appointment letters for directors, supervisor and legal representative.
• Address evidence: A lease or proof of the registered office, plus documents for any special licence your activities require.

Keep originals and scanned copies, and confirm which documents must be signed in front of a notary. Missing a single legalisation step can restart the clock, so review the full list before submitting.

05 · ChinaMNC

Registered address and business scope

Two details that founders often underestimate are the registered address and the business scope. Both appear on the licence and shape what the company can legally do.

The registered address is the company's official location. It must be a real, documented premises acceptable to the local authority. Many founders use a serviced office or an incubator that supports foreign-invested companies, which can be practical for an early-stage team. Check that the address can host your entity type and that the lease supports registration.

Business scope lists the activities the company may carry out. Write it to match your actual plans, because some activities require pre-approval or special licences, and adding them later can mean a change filing. Keep the wording aligned with the standard categories used locally, and avoid copying a long list you will never use.

If you plan to sell online, provide services, or import goods, confirm the scope covers those activities and any related licences before you sign a lease or hire staff.

06 · ChinaMNC

Banking, tax and visas

Once the licence is issued, the operating basics come into focus.

• Banking: Open a corporate account with a bank that handles foreign-invested companies. Expect know-your-customer checks on shareholders and directors. Set up online banking and foreign exchange registration so you can move capital and pay suppliers.
• Tax: Register with the tax authority, understand invoice rules, and set up monthly or quarterly filings. Engage a local accountant early; bookkeeping and payroll obligations start quickly after registration.
• Visas and permits: Foreign staff usually need a work permit and a residence permit. The company may also need to register foreign employees with the relevant authorities. Plan lead time for each application.
• Ongoing compliance: Annual reporting, statutory audits where required, and social insurance contributions for local staff are recurring duties.

Rules and processing times vary by city and change over time. Confirm current requirements with a local accountant, lawyer or the relevant authority before relying on any timeline.

07 · ChinaMNC

Common mistakes to avoid

Many setup problems are avoidable with a little planning.

• Choosing a structure that cannot do the job. A representative office cannot invoice customers, and a scope that omits key activities can block sales. Match the entity and scope to real plans.
• Underestimating document formalities. Notarisation, legalisation and translation take time. Start early and check the requirements for each investor's country.
• Treating compliance as optional. Late filings, missed tax deadlines and incomplete records create penalties and friction. Budget for professional accounting from day one.
• Ignoring localisation. Pricing, product and support built for another market may not fit China. Test demand before scaling headcount.
• Going it alone. A local adviser who has registered foreign-invested companies in your city can catch issues before they become delays.

None of this is unusual for a new market. The founders who do well plan carefully, ask questions early, and keep their paperwork in order.