Opening an Office in China

The Peoples Republic of China has one of the fastest growing economies in the world, with Beijing, Shanghai and Guangzhou being some of the top choices for foreign companies looking to open new business operations.

Registering a business in China

There are number if options available when setting up and registering your business or office in China which include wholly owned foreign enterprises, a representative office, contractual joint venture firms, equity joint ventures and local representation companies. You will need to obtain a registration certificate, also called a business license.

Work Visas

Foreign nationals must apply for a work visa before entering China and this application ought to be supported by official documents including the company’s business license, a copy of a certificate of approval (if registered as a foreign invested enterprise), letter of employment and a copy of the labour contract. A health check report may also be required as well as an Employment Registration Form of Foreign Employees in China.

Taxes

Although China previously offered various tax benefits and financial incentives to foreign investors companies in the past, this is no longer the case in most states so it is worth checking. Applicable business taxes in China include enterprise income tax, VAT, resource tax and consumption tax. The two newest taxes that foreign companies now have to pay are the Urban Construction and Maintenance Tax as well as the Education Surcharge Tax.

Human Resources

Under PRC law (Peoples Republic of China) employers must sign written employment contract, before employment commences. It is advisable to employ Chinese nationals when recruiting employees, who can also help to effectively manage local business staff. They will be better able to understand and communicate with clients and customers and understand the myriad of cultural differences than International staff may be able to.

Expanding your business in China can potentially be a very profitable venture, and by respecting cultural differences and adhering to business protocols you will be better able to communicate and maximize your business dealings.