What You Need To Know About Setting Up A Company In China
- Written by NewsServices.com
Keen on expanding your business and looking forward to establishing a company in China? Setting up a new business in one of the world’s attractive business jurisdictions can be daunting. There are just so many things that you will have to fully understand and grapple with, including:
* Sets of laws governing the establishing and running of business
* Rules and regulations
* The Chinese business culture
* Trade know-how
As a global economic hub, China has consistently been experiencing exponential growth and hence attracting investors keen on exploiting its vast customer base from far and wide. Whether you want to open a branch, start a completely new venture, or simply want to spread your business wings, China is the perfect launching pad to help you achieve a competitive edge.
Of course, this brings us to the next question. How do you set up your business in China and ensure you take advantage of its enormous customer base, technological advancements, and attractive business environment?
Process of Setting up A Company in China
Enlist The Services Of An Agency To Help In Setting Up Your Company
The Chinese government has done everything in its power to ensure that setting up a company in China is seamless and stress free. However, you will agree with us that as a foreigner looking to set up your business, the process can be challenging.
So how do you go around this minor challenge? You guessed it right, an agency! Corporate service agencies have the technical know-how, the expertise, the knowledge, and the understanding of the local business environment to ensure that your business is up and running within no time.
Other than just assisting you with company setup, they are also instrumental in restructuring your business, providing you with fundamental business advice, updating company records, hiring local stuff on your behalf, and ensuring that you maneuver through the process of company registration with ease.
Determine Company Specifications
The Chinese laws, rules, and regulations require that you define or rather determine the specs of your business. What is the type or structure of your business? (Is it a joint venture, Wholly Foreign-Owned Enterprise, or a representative office?). What is the business name? Where is it located? Who are the registered directors? All these specifications need to be clear under the Chinese laws.
Registration And Licence
Now that the business scope is clear (business type, business name, business location etc.), it is time to submit the business registration form together with the required business documents to the government offices.
These documents include business license, approval certificate from State Administration of Industry and commerce (SAIC) and Ministry of Commerce (MOFCOM), registering with the Public Security Bureau (PSB), and issuing company stamps from registered IAC.
Bank Account Opening
To effectively run your business operations, you need to open a bank account in China. How else will you be able to pay business expenses, deposit registered business capital, or even buy raw materials? Opening a corporate Chinese bank account is therefore instrumental to the smooth running of your business.
Tax Bureau Registration (Fapiao And VAT)
Just like you pay taxes in your home country, you require paying taxes for your business in China, too. This means that you will have to register with the tax bureau as a VAT tax payer. You will either be a general taxpayer or a small-scale tax payer depending on which industry your business operates in.
It will require you to have Fapiao (which is basically a tax receipt that is printed by a Fapiao machine). This is instrumental, especially if you will engage in business with local Chinese clients who prefer receiving Fapiao for their businesses.
If you are keen on learning more about setting up a company in China and how to go about it in the best way possible, reach out to Fiducia.