Malaysia Hotline: +603-2141 8908
Foreign-owned
Enterprise is also called foreign-funded company, foreign-owned company,
foreign company, foreign-funded enterprise and foreign enterprise.Since the
implementation of the reform and open-up policy, Shanghai has been seen a
booming economic, which brought not only numerous business opportunities, but
also investors all over the world. Especially, the requirements of foreigners
investing in Shanghai has released. And it will benefit more foreigners who
extend business in Shanghai.
I. Foreign-owned Enterprise-WFOE
Normally the
WFOE is Limited Co. A certain rate between the equity capital and the
investments is regulated and is according to the sector. Two reports are
necessary for the formation of a Ltd. To found a Ltd. You need a project report
with the documentation of the project, the aim, etc. as well as a feasibility
study. In most of the times both reports can be put together into one document.
Next to these reports a good relationship to the government is an advantage. If
you follow just the exact rules rather than the Chinese way while founding the
company, the formation can take a long time.
II. Foreign-owned
Enterprise-Representative Office
The formation of
a representative office is for many companies the first step to Shanghai. In
most of the cases these companies already have a customer base in Shanghai and
want to support them or get accustomed to the new environment. The
representatives are founded out of marketing and promotion reasons in most of
the times. A sponsor is necessary for the formation of a representative office
in Shanghai. This has to be a Chinese company. Mostly the company is founded in
cooperation with existing customers or business partners. The problem
concerning a representative office is that they are not allowed of signing
business deals or contracts. They are not allowed to be involved in any
business operations as well as selling products in Shanghai. For such
activities they need a Chinese company or trade office. The initiation and
searching of new business contacts, consultation and perhaps the creation of
market studies are their main tasks.
III. Foreign-owned Enterprise-Joint
Venture (JV)
In earlier year
the Joint Venture was the most common business type for foreign enterprises in
Shanghai. In some sectors it was and still is necessary for the formation of
such a company as a car producer or the aircraft industry. A crucial point for
the formation of the JV is to gain market shares, customers and knowledge about
the Chinese market through the JV-partner.
IV. Foreign-owned Enterprise-FIPE
FIPE stands for
Foreign Invested Partnership Enterprise. In Shanghai, there are 4 modes of
business presences for foreign investors: WFOE(65%), Representative
Office(20%-), FIPE(10%+), Joint Venture(5%). FIPE becomes more and more popular
among young entrepreneurs with their new startups in Shanghai as it requires no
registered capital but the FIPE still could hire people, collect payments,
issue invoices, apply for work & residence in Shanghai freely. It's not a
surprise that most people you meet in Shanghai may not know anything about FIPE
as it's relative new and government is not promoting on this.
Tannet Malaysia is an international consultant firm based in Hong Kong, Shenzhen. We do have over 10 branches in China which I believe we are your best choice for your ASIAN investment. We provide one stop business solution ftom pre-setting up preparation to incorporation, management to operation, market strategics and brand protection and etc. Kindly contact for more information on our other services if you are interested!
Contact us:
If you have further queries, please contact Tannet.
24 hours Malaysia hotline：603-21418908;
24 hours Hong Kong hotline：852-27837818;
24 hours Shenzhen hotline：86-755-
36990589;
Email: mytannet@gmail.com
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