Shenzhen Company Establishment (WFOE) refers to establish a WFOE in Shenzhen. WFOE stands for Wholly Foreign-Owned Enterprise, which is a privately owned company in China that all shareholders involved are foreign. It is a highly favored investment model as the foreign parent company exercises full autonomy and control.
Shenzhen is a major city in Guangdong Province, China. It forms part of the Pearl River Delta megalopolis. Through years of development, Shenzhen has become a major financial center in southern China. The city is warmly welcome foreign investment. The following exposition brief investors on how to register a WFOE in Shenzhen.
Different Types of WFOE
Generally speaking, there are mainly three different types that you can choose, namely,
(1) Manufacturing WFOE, which allows you to set up a manufacturing facility in mainland China.
(2) Consulting WFOE, which allows you to provide consulting services.
(3) Trading WFOE, which gives you both import and export licenses and you can also trade locally.
Company Name Approval
One of the first steps for foreign companies is to decide on an appropriate name for the Chinese market. The key pieces of legislation governing this are the Regulations on Registration and Management of Enterprises Name and the Implementation Measures on Registration and Administration of Enterprise Names, which detail how a Chinese company name should be structured.
Office Location Selection
As the company name contains the city of registration, careful consideration should be made before engaging an estate agent or landlord. In some cases, the city name can affect operations, as certain city names carry prestige and credibility that may impact sales, business development, and governmental relations.
Determination of Registered Capital
Registered capital refers to the amount of capital that would be sufficient to support a WFOE’s activities for a minimum period of one year after establishment. The WFOE’s registered capital shouldn’t be too little, which would lead to rejection of the enterprise application and risk insolvency. It shouldn’t also be too much, leading to idle funds and missed opportunities. The sufficient amount of capital varies based on such factors as the WFOE’s industry, the region of incorporation, among others.
Requirements on Company Member
According to Company Law, all WFOEs should have at least one supervisor who oversees the performance of company duties by its directors as well as top management personnel. To avert any conflict of interest, all directors and the senior management personnel are not allowed to concomitantly act as supervisors. A relatively small company with a few shareholders can have one or two supervisors. However, bigger companies are required to have a board of supervisors of not less than three members.
Documents Required for Setting Up a WFOE
Gathering the documentary evidence needed to apply for a WFOE is time-consuming. Tannet will guide you through this every step of the way. We will require the following documents from you in order to open a WFOE, including but not limited to:
(1) Company director/s passport copies;
(2) Company office lease rental contract;
(3) Business feasibility report;
(4) Chinese name of company;
(5) Business scope;
(6) Copies of overseas company registration documents (required if a company is the foreign investor).
Tannet provides one-stop and tailor-made services for foreign companies which would like to set up WFOE in Shenzhen China. We also provide a series of follow-up services, including but not limited to bank account opening, CPA report, bookkeeping, auditing, tax return filing, annual return services, financial planning, etc. Our experienced consultants will be glad to assist and advice on how to approach your particular challenge.
Contact Us
If you have further enquire, please do not hesitate to contact Tannet at anytime, anywhere by simply visiting Tannet’s website english.tannet-group.com, or calling Hong Kong hotline at 852-27826888 or China hotline at 86-755-82143422, or emailing to tannet-solution@hotmail.com. You are also welcome to visit our office situated in 16/F, Taiyangdao Bldg 2020, Dongmen Rd South, Luohu, Shenzhen, China.
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