Wholly foreign owned enterprise formation in Shenzhen is one of the most popular options for startups to set up a business in this promising city. Abbreviated as WFOE, it is a limited liability company wholly owned by the foreign investors. In China, WFOEs were originally conceived for encouraged manufacturing activities that were either export orientated or introduced advanced technology. In short, WFOE provides greater control, ownership and operation freedom to foreign investors, which is why more and more foreign companies want to explore this option.
Types of WFOE in Shenzhen
1. Consulting Wholly Foreign Owned Enterprise
Consulting businesses are categorized under the consulting or services sector. This the most basic type of WFOE, which has fewer registration formalities, legal approvals and documentations, compared to its counterparts.
2. Manufacturing Wholly Foreign Owned Enterprise
WFOEs can also enter the manufacturing sector by adhering to certain business requirements, registration process and local and state approval. In order to operate in the manufacturing sector, foreign investors need to scout a property for the production facility.
3. Trading Wholly Foreign Owned Enterprise
Trading WFOE is also known as FICE or Foreign Invested Commercial Enterprise. The business scope of such companies is limited to trading of products as a wholesaler or retailer. Businesses can either export goods from China or sell them to customers located outside China or sell imported goods to the Chinese customers.
Requirements on WFOE
1. Business Scope
In the initial steps of the registration process you’re required to identify the scope of your business by developing a 5-year business plan. Make sure your business scope accommodates growth and allows you to participate in different business activities.
2. Registered Capital
Registered capital is required for the safety of suppliers, employees and customers. Although, 30 percent of registered capital requirement is no longer applicable on establishment of a WFOE, it’s a common practice to show sufficient register capital to cover the initial operational activities of a new business.
3. Company Name
You need to get your company name approved from the local Administration for Industry and Commerce (AIC) authority. Follow the official format of naming the company and use the order highlighted below:
1. Name of the region, where your WFOE was incorporated;
2. Brand name;
3. Industry type;
4. Entity type (LTD or Inc).
Tannet’s Turnkey Services
1. Provision of registered address;
2. Bank account opening;
3. Corporate secretarial services;
4. Accounting, tax filing and auditing;
5. Entry visa /work permit application;
6. Staff recruitment and payroll management;
7. China trademark/patent/copyright registration;
8. Global barcodes registration.
Registering a WFOE in Shenzhen and other parts of mainland China is a complicated process for foreign investors. Most of the paperwork is in Mandarin and requires countless approvals from local and state authorities. Tannet can simplify and streamline the registration process for you. We provide a full range of services from business setup to business followup to help you in doing business in Shenzhen.
Contact Us
If you have further inquires, 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 86-755-82143512, 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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