|
When considering setting up a business in China, one needs to consider what structure to use. Before the structure can be determined, it is best to complete your strategy which will lead to the structure.
Some questions to consider:
Do you want to simply sell into China?
Do you need a Chinese Partner or will you try to go it alone?
Do you require an entity in Mainland China?
Do you need to invoice locally for products/services?
Do you plan to trade, manufacture, offer services or some combination?
Do you need the help of a Chinese company providing access to distribution?
Once you have defined your strategy, then you can determine the legal form for your entity. Foreign investors have several choices for structuring a China enterprise:
1. The Representative Office: The least dynamic of the entities for establishing a foreign presence in China. The RO can facilitate market entry and coordinate sourcing activites and marketing, but it is a toothless version of the possible foreign entities that has little control over the movement and sale of goods and services. However, for 'testing' your China strategy, this is a low cost/risk approach.
2. The Joint Venture: If both you and your Chinese partner's goals, contributions and responsibilities are mutually understood, the JV can be a cost effective and successful structure.
3. The WFOE Wholly Foreign Owned Enterprise: The WFOE has become the investment vehicle of choice for the international investor wanting to manufacture, service or trade in China. In addition to the WFOE's expansive business scope, its popular because you have 100% foreign ownership and control, security of IP rights, your own internal structure, domestic sales and profit repatriation.
China Investment Opportunities:
China's Economy depicts the growing economic rise of the largest global emerging market in the world. growth in new economy era and the trend of globalization lead more and more US businesses to the idea of doing business in China, acquiring existing businesses, identifying investment partners, or making investment into Chinese entities. Our advisory services include introducing you the procedures and policies of establishing company and representative offices, legal and regulatory requirements, due diligence, banking relations and other requisite services. Many US based Venture Capital, Private Equity and Investment Banking companies have established China offices to invest in Chinese Companies, and US/China Joint Ventures. CUBD will assist your company in navigating through the labyrinth of China's financial industry to find the right partner for your venture.
To learn more please contact us at info@cu-bd.com | 
