China Company Formation

Briefly, foreign investors are allowed to invest into China market by forming either a Wholly Owned Foreign Enterprises (“WOFE”) or Representative Office (“RO”):


The WOFE is a limited liability company wholly owned by the foreign investor(s). It is the most popular choice for foreign companies doing business in China in international trading, manufacturing, consulting and other profit making activities. Many foreign investors find this structure attractive because of the full control which comes with 100% ownership.


A RO is an office that carries market contacts and research which is set up to represent the foreign parent company. It is the easiest and least costly method for foreign enterprises to establish an initial presence in China. A RO is not recognized as a separate legal entity; it cannot issue any invoices and gain income by itself, and all of its expenses are fully funded by the parent company. However, a RO can open bank accounts and employ staff to maintain liaison with customers and suppliers.