Doing Business in China

As foreign investors and companies,set up your own office in China is important.You can select a representative office,or a joint venture,or a wholly foreign owned enterprises in China.Here are the Merit and the demerit of diffrent corporate structures in China.

The merit of establishing a representative office is easy and quick,it is also cost effectively.The demerit is that you are not allowed to be engage in direct sales,you can't issue invoices in Chinese Local currency RMB either.

Most companies choose a joint venture which can be equity joint venture or contractual joint venture.The foreign company would own a minimum 25% of the new entity.The merit of joint venture is your partner will provide the facilities and work force,they also provide sales and distribution networks.The demerit is you should share the profits with your joint venture partner.It is also much harder to install your own business culture and much harder to protect your intellectual properties.

To set up a wholly owned foreign enterprises means that you are the owners of the company.The merit is you have the 100% ownership of the business and 100% profits.The demerit is you should look for the work forces and the workshop,you also have to set up your own sales and distribution networks.