The energy sector in China is extremely powerful and that because the country is the first electric power producer in the world. A business in the energy sector in China is definitely a good idea for local and international investors and entrepreneurs who want to generate money in this important sector. One of our company formation specialists in China can guide you when opening a company in China and can provide support and assistance for establishing an energy company in this country.
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What is the proper structure for an energy company in China?
The Wholly Foreign-Owned Enterprise or WFOE in China is in most cases the ideal choice for international entrepreneurs who want to make investments in the energy sector in China. It is good to know that top 5 electric utility companies in China are state-owned with listed subsidiaries that can act as autonomous energy producers in China. In the case of WFOE registration in China, it is mandatory to make a name verification and then a reservation to be sure your company can own the desired business name. The following aspects relate to the opening of a WFOE in China:
- the minimum share capital required for a WFOE in China is CNY 30,000 except the free trade zones in China where such condition is not imposed;
- a feasibility report is needed for opening a WFOE in China’s energy sector;
- a local representative and aa board of directors are needed for a WFOE in China;
- the business license and the registration for tax purposes are mandatory.
Providing complete support for establishing an energy company in China enters the attention of our company formation agents in China who can handle the registration procedures in such a case. Foreigners might find it difficult to align with the business requirements in China, so the help of our advisors will prove essential, particularly for those wanting to start a business in the energy sector.
Investing in existing energy companies in China
A good business solution for foreigners in China is to make investments in existing energy companies instead of creating a new one. Some might be interested in renovating important power plants in China or some can become energy distributors in this country, with the approvals of the Ministry of Commerce and Ministry of Foreign Affairs in China.
Producing solar panels in China
Another good business idea which can be adopted by foreigners wanting to activate in the energy sector in China refers to the production of solar panels that can be sold worldwide. Such a business can benefit from the experienced workforce available in China in this field and from low labor costs that can be quite attractive. International companies dealing with solar panels production can decide on opening a branch or a subsidiary in China and implement such a business quite fast on the market. The concentration on renewable energy is top priority in China’s electric power sector, so many domestic and international investors are attracted by this important field. China’s solar photovoltaic power sector is a growing industry, where there are already 400 companies registered.
The energy sector in China
The coal production in China is huge, as the country is considered the biggest producer and also consumer in the world. There are numerous coal power plants in China, under the supervision of China Electricity Council and the National Energy Administration in China, two important institutions that can approve foreign investments in the energy sector. Hydropower plants, wind power plants, nuclear and solar power factories are found in a large number in China, most of them state-owned. The authorities in China want to accelerate the development strategies for nuclear power plants in China by encouraging the investments in this area. The following facts, details and reports refer to the business and investment direction of China:
- Being the second largest foreign direct investment recipient in the world makes China a top business destination for numerous entrepreneurs.
- About USD 140 million represented the FDI inward flow for China in 2018.
- Even the number of greenfield investments, about 871 in 2018, make China appealing to investors from abroad.
- USD 1,627,719 million was the total FDI stock in China in 2018.
- The latest report showed by World Bank, the “2019 Doing Business” report ranks China 46th out of 190 worldwide economies.
International entrepreneurs have plenty of business opportunities in China’s energy sector. Those wanting to open a company in the energy sector in China can get in touch with one of our company formation agents in China.