Large companies worldwide can choose to set up their operations in China through branches. This kind of business form respects both the rules and regulations of the parent company and the legal conditions in China. Even if the registration process of a branch in China is simple, it is best to ask for support and guidelines from our Chinese team of company formation representatives.
For foreign countries
Best used for
– financial activities
Minimum share capital
|Time frame for the incorporation (approx.)
Around 2 months
Local, but not mandatory
|Legal representative required
|Local bank account
|Independence from the parent company
|Dependent on the parent company
|Liability of the parent company
|Full liability on the branch office’s debt and obligations
|Corporate tax rate
|Possibility of hiring local staff
Table of Contents
Conditions to open a branch in China in 2024
As it is recommended, foreign entrepreneurs interested in expanding their operations on the Asian market and particularly in China should, first of all, decide on the business type that suits most to their needs and purposes most. In this case, establishing a branch in China may represent the proper business idea, keeping in mind the mandatory requirements for such an entity and the ones imposed for doing business in China. It is good to know that branches in China are registered through WFOE (Wholly Foreign-Owned Enterprise) In this sense, the parent company which is going to register a branch in China must observe the following conditions with the help of the legal representative of the future business:
- submit the Articles of Association with complete information about the owners
- submit the minimum share capital of RMB 100,000 as established for WFOEs in China;
- open a business bank account in the local currency to draft the capital;
- register for tax purposes with the National Tax Bureau (taxes and social contributions);
- apply for the branch stamps (they can function as signatures).
Instead of dealing with the language barrier or with any other issues that might occur, you can get in touch with our company incorporation agents in China for help in this matter. We also remind foreigners that our advisors can act on behalf of their businesses in China as legal representatives, nonetheless of the chosen business entity. Registering a company in China is less bureaucratic and investors can start the operations in a fast manner.
It takes around 5 days for a pre-approval for the branch name in China, depending on the formalities imposed by the district or the municipality where the incorporation takes place.
If you would like to open a branch in China in 2024, you can rely on the support of our representatives. We have a dedicated team who can handle the entire formalities and procedures. Here is an infographic that explains more:
Do I need an office for a branch in China?
Yes, branches in China that are registered as WFOEs need to have a business address in the first place. In other words, a traditional office for your company in China is necessary. We remind you that foreign investors who want to control their businesses from their home country can ask for virtual office services or can set up representative offices in China.
Those who want to set up a company in China can benefit from complete support from our local specialists. A series of formalities are required, including opening a local bank account, registering for VAT and other import taxes, and obtaining a business trade license. The establishment process can take around 3 months, but in order to be able to focus on your investments in this country, we recommend the support offered by our agents with experience in this field.
Our accountants in China can offer you a series of services if you have a company registered in this country. In addition to bookkeeping and payroll, you can also benefit from tax registration or the administration of human resources. Our clients can get an idea about tax minimization methods available or they can opt for personalized financial consultancy services. Whatever type of business is developed, we are here to offer you the necessary support.
A Chinese branch office is limited to the business activities of the parent company, and in addition, it cannot independently import/export goods. Such operations are normally performed by the head office incorporated in the country of origin.
The 5 in 1 filling system is available in China. This kind of system allows local and foreign entrepreneurs to apply for the desired and required business license for branches. Applications can be made with the Tax Registration, Social Security, and other essential organizations in China.
Register for tax purposes in China
Branches in China need to register for tax purposes before commencing any activities. The company’s documents must be submitted to the National Tax Bureau in the chosen city for business, in charge of tax collection. Also, branches in China need to register with the Quality and Technology Supervision Bureau for the registration code and with the State Administration of Foreign Exchange if the activities involve different currencies and foreign business relations. For VAT registration in China please talk to our consultants.
Here is a video about how you can open a branch in China, helped by our consultants:
What are the benefits of a branch in China?
Branches in China respect the same conditions as registering a WFOE (Wholly-Foreign Owned Enterprise), except the fact that the incorporation is much faster. Among the benefits of a branch in China, we remind you that such an entity has its own licenses and seals and can start activities as soon as it has been registered with the local authorities in charge. Likewise, branches in China can easily sign deals and contracts with local companies and can participate in varied business activities. If you want to open a company in China, regardless of the chosen business form, you can rely on the support of our advisors. In case you want to set up a company in elsewhere, for example in Taiwan, we can put you in contact with our partners.
In case you want to open a branch in Hong Kong, you should note that only a Hong Kong resident can be appointed as a representative. He or she is in charge of accepting any legal notice concerning the business. Besides that, branches in Hong Kong must have a business address located here.
Other branch registration requirements in China in 2024
Besides enrolling with the tax authorities, a branch in China needs to register with the Public Security Bureau for obtaining the branch stamp, and the financial stamp. One should note that the company stamps of a branch in China can be used instead of a signature. Registration with the State Administration of Foreign Exchange, the National Bureau of Statistics, and the Quality and Technology Supervision Bureau in China is required. All the formalities that must be respected when dealing with the above-mentioned institutions can be explained by our Chinese company formation agents.
Opening a branch in China in 2024 requires complete attention, so you can hire the services of our specialists in company formation in China and benefit from complete support throughout the entire process.
Branches in Hong Kong must respect the tax rules and compliance. As such, tax returns are filled within one month after the issue date. Plus, in some cases, branches established here can be subject to provisional profit tax which is considered based on the registered profits from the previous fiscal year.
Is a business license required for a branch in China?
Specific activities might require licenses and permits, so in this case, it is best to verify the activities you want to implement prior to registration. The license application in China is made with the relevant authorities, mentioning that all the documents must be completed in Chinese. Preparing the documents and formalities for licenses and permit applications in China to enter the attention of our specialists in company formation in China. We advise you to discuss all the aspects of a branch registration in China with our experts instead of dealing on your own with the bureaucracies.
FAQ about branches in China
The Wholly Foreign-Owned Enterprise or WFOE is a great choice for international entrepreneurs who want to establish a branch in China. The formalities can be completely handled by our specialists.
RMB 100,000 is the minimum share capital for a branch in China, established under the rules of a WFOE. It is recommended to open a bank account in the local currency. Our specialists can help you.
Yes, all companies in China must register for taxation and branches make no exceptions. Tax compliance and management can be discussed with our company formation agents in China who can enroll your branch in China with the National Tax Bureau.
No, branches in China cannot develop import and export activities on their own. Specific business rules in China can be explained by our agents.
Yes, a branch in China works as any kind of company with activities developed locally or abroad. Signing contracts is not restricted, yet one must observe the general and local regulations apply.
Yes, compared to a subsidiary, a branch is cost-effective and often the choice of international entrepreneurs interested in business in China. You can talk to our company formation agents in China and find out more about the operational costs in this country.
Dependent branch offices in China can be involved in marketing-related operations, maintain contacts and develop new business collaborations. Yet, these cannot participate in business transactions and cannot issue invoices compared to independent branches.
Yes, it is recommended to hire an accounting firm in China and benefit from tailored services to the business needs involving a branch office. Annual financial statements, tax compliance, bookkeeping, and payroll are the main accounting services required for a business in China.
It is required to have a local representative for your branch in China. One of our company formation agents in China can represent you and explain the business regulations in this matter.
No, the formalities for opening a branch in China are relatively straightforward if you respect the general and local business rules.
You can talk to our agents about branches in China and you can also read interesting facts and figures about the economy and business in China:
- Nearly USD 2,064 billion represented the total FDI stock for China in 2021.
- China ranked 50th out of 82 countries in the world, in the latest Economist Intelligence Unit business environment review for the first half of 2022.
- China is ranked the second largest FDI recipient in the world, after the USA.
- Singapore, Hong Kong, South Korea, Germany, Japan, USA, and the Cayman Islands are the main investors in China.
If you would like to know more details about how to set up a branch in China, please do not hesitate to contact our team of company formation consultants in China.