Register and run your company in mainland China

01 · ChinaMNC

Why China, and why now for a foreign founder

Founders usually look at mainland China for one of a few reasons: a large domestic customer base, deep supplier and manufacturing networks, or the wish to be physically close to partners and talent. Each reason points to a different structure and a different cost profile, so it is worth being honest about your primary motive before you choose an entity type.

China is not one market. City-level practice, industry rules and available talent differ significantly between, for example, Shanghai, Shenzhen, Guangzhou, Beijing and second-tier cities. The same business plan can be straightforward in one place and heavily restricted in another.

• Market access: some sectors are open to foreign investment, others are restricted or require local partners.
• Supply chain: being on the ground can help with quality control, sourcing and supplier relationships.
• Talent and operations: hiring locally usually requires a legal employer entity.
• Customers: many buyers and platforms expect a mainland-registered company, invoicing and local payment.

Plan for real operating costs, not just registration. Rent, staff, accounting, compliance and management time usually matter more than the setup fee itself.

02 · ChinaMNC

WFOE, joint venture or representative office

Most foreign founders choose between three common vehicles. A wholly foreign-owned enterprise (WFOE) is a limited liability company owned entirely by foreign investors. It can generally conduct approved business activities, hire staff, invoice customers and hold a bank account, which is why it is the default choice for founders who want to trade or deliver services locally.

A joint venture (JV) involves one or more Chinese partners. It can make sense where local knowledge, licences, land, distribution or government relationships are essential, or where the sector requires a local partner. The trade-off is governance: decision rights, profit sharing, exit mechanics and deadlock resolution all need careful drafting before you sign.

A representative office (RO) is a liaison presence. It cannot usually earn revenue directly; it supports market research, coordination and liaison for a foreign parent. It can suit a first exploratory step but is rarely enough for an operating business.

• WFOE: full control, more setup requirements, suitable for most operating businesses.
• JV: local partner access, shared control, needs strong legal agreements.
• RO: low operational scope, no direct revenue, useful for liaison.

Check sector restrictions and local practice before you decide.

03 · ChinaMNC

The five-step process in outline

The exact sequence and paperwork vary by city and industry, but most setups follow a similar shape. Treat this as a map, not a fixed schedule.

• Step 1, plan and check: define your business activities, sector rules, ownership, capital plan and city. Confirm whether your activities are open, restricted or prohibited for foreign investment, and whether any sector licence applies.
• Step 2, prepare the company: choose a company name, registered address, legal representative, supervisors and scope of business. Prepare investor documents, including notarisation and legalisation or apostille where required, and translations.
• Step 3, approvals and registration: handle the foreign investment information reporting and market entity registration, then obtain the business licence and company seal set. Some activities need a separate permit before trading.
• Step 4, bank and tax setup: open the corporate bank account, complete tax registration, and arrange invoicing, accounting and payroll. Foreign currency and RMB accounts may both be relevant.
• Step 5, people and operations: arrange work permits and residence permits for foreign staff, social insurance registration, and the leases, contracts and policies you need to trade.

Expect dependencies between steps. A bank may need a licence, and a licence may need a lease.

04 · ChinaMNC

Documents founders usually need

Document lists are city- and case-specific. The following are the items founders most often have to gather or decide. Always confirm the current list with your local adviser before you spend money on notarisation or translation.

• Investor documents: certificate of incorporation or equivalent for corporate shareholders; passport copies for individual shareholders; ownership charts where needed.
• Notarisation, legalisation or apostille: many jurisdictions require investor documents to be notarised and then legalised or apostilled, depending on the applicable convention. Translations into Chinese are commonly required.
• Company details: proposed name options, registered address, business scope wording, registered capital and contribution plan, legal representative and supervisor candidates.
• Address evidence: lease or ownership documents for the registered address, plus any landlord documents the registry requests.
• People documents: passport copies, photos, resumes and contact details for directors, supervisors, legal representative and authorised signatories.
• Bank and tax: identification, company seals, incorporation documents and, in practice, evidence of the business and its expected flows.

Keep originals consistent. Mismatched names, dates or addresses are a common cause of delay.

05 · ChinaMNC

Registered address, business scope and capital

Three choices shape both registration and daily operations: where the company is registered, what it is allowed to do, and how much capital it commits.

The registered address must be a real, acceptable address in the registration authority's view. It is not only a mailing address; it is where the company is legally located. Some cities allow serviced or virtual-style arrangements for certain activities, others do not, and regulated businesses may need premises that meet specific standards. Confirm zoning, landlord cooperation and what documents the address can provide.

Business scope is the formal description of your activities. It should be wide enough to cover what you actually plan to do, but drafted in accepted local wording. Some activities require a pre-approval or a separate licence; others are simply not open to foreign investment. Over-broad scope can trigger extra scrutiny, while a scope that is too narrow can block invoicing or contracts later.

Registered capital is a commitment, not a marketing figure. Under China's company law framework, shareholders are generally required to pay subscribed capital within the period stated in the articles, and recent reforms have tightened expectations around contribution timing. Choose an amount you can realistically fund, because it affects credibility, liability and cash planning.

06 · ChinaMNC

Banking, tax, accounting and visas

After registration, the operational work begins. Banking is often the step founders underestimate. Opening a corporate account usually involves due diligence on the company, its owners and its expected transactions. Prepare a clear explanation of your business, customers, suppliers and expected payment flows, and be ready for questions about beneficial ownership.

Tax registration and ongoing filing are not optional. A newly established company typically needs to handle tax registration, invoice setup and periodic declarations, even in periods with no revenue. Accounting should be set up from day one: bookkeeping, payroll, social insurance and statutory filings are recurring duties. Many foreign founders use a local accounting firm, at least in the early stage.

For foreign staff, working in mainland China generally requires a work permit and a residence permit, and the employer must be a qualifying entity. Requirements depend on the role, qualifications and city. Plan the visa and permit sequence alongside the company setup, because the company must usually exist before applications can proceed.

• Banking: prepare ownership and business-flow evidence.
• Tax: register, understand invoicing, and file on time.
• Accounting: keep books, payroll and social insurance current.
• Visas: align work and residence permits with the entity's status.

07 · ChinaMNC

Common mistakes to avoid

Most problems are avoidable with a little discipline. These are the mistakes foreign founders most often make.

• Choosing structure by habit: picking a WFOE or JV before checking sector rules, city practice and whether a licence is needed.
• Treating capital as a headline number: subscribing more capital than you can fund within the stated period.
• Ignoring the address: assuming any address will be accepted, or failing to confirm what the landlord will provide.
• Drafting scope too narrowly or too broadly: either blocking future invoicing or inviting unnecessary scrutiny.
• Underestimating banking: arriving without a clear explanation of ownership and expected transactions.
• Skipping compliance in quiet months: missing filings or invoice duties before revenue starts.
• Weak JV paperwork: leaving governance, deadlock and exit terms vague.
• Starting visa work too late: assuming foreign staff can work while permits are pending.

Get local professional advice on your specific case. Rules, practice and fees change, and no generic page can replace a review of your facts.