Opening a representative office in China is a common choice for foreigners. For foreign investors looking to do business in Mainland China, there are four main options that they can choose from. Wholly Foreign Owned Enterprise (WFOE); Representative Office (RO); Joint Venture (JV); Foreign invested Partnership Enterprise (FIPE). In this exposition, Tannet mainly introduces how to set up a representative office in China.
Brief Introduction to Representative Office
As the name suggests, a representative office in China is the local representative of your business, a place where local Chinese clients and contacts can meet you, and a place that can exert control over your brand, marketing, and supply chain in China. It can't perform any business activities related to making profit however.
In simple words, a representative office is a local Chinese branch of a foreign company or brand. With a representative office, foreign companies can maintain a physical presence in China.
Benefits of Opening a Representative Office in China
Despite the fact that representative offices can’t be used to conduct profitable business operations, it still offers a number of benefits that foreign companies find lucrative.
1. Official Presence in China
With a representative office in China, companies gain an official presence and conduct meetings with suppliers and clients while simultaneously coordinating work between the head office and representative office.
2. No Capital Required
Since there’s no registered capital requirement as far as representative offices are concerned, setting one up Is fast, easy, and accessible for most foreign companies.
3. Taxation Relief
There's no denying that tax system in China tends to get a bit complicated, especially for foreigners. However, with a representative office, taxation is quite simple and straightforward. The only tax that applies to a representative office is the one on its running costs and salaries.,Since a representative office isn’t exporting or selling anything, there are no other taxes to worry about.
4. Business Opportunities
With a representative office, foreigners can perform market research, locate new clients and suppliers, carry out promotions and marketing operations, exchange ideas and technologies, as well as perform quality control for the parent company.
How to Open a Representative Office in China
To establish a representative office in China, you need to ensure and provide:
1. The parent company to have been running for more than 2 years;
2. A letter from your business bank demonstrating good financial standing;
3. Your parent company's certificate of incorporation;
4. A summary of the parent company's business: Activities, products, services, locations, and contact details;
5. CVs and passport photos of the foreign representatives joining your rep office;
6. Rental contract of the office where the rep office is to be based (needs to be arranged in advance of application).
With Tannet, your representative office registration process will go smoothly. Our extensive experience and English proficient consultants guarantee a quick and hassle-free service.
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 86-755-82143422, 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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