The most obvious way for foreigners looking to do business in China is to set up a Wholly Foreign Owned Enterprise, abbreviated as WFOE or WOFE. What is a WOFE ? Under Chinese law, a Wholly Foreign Owned Enterprise is a limited liability company that is fully owned and capitalized by foreign investors and operated without a local (Chinese) partner. This provides you with greater control over your businesses operations, revenue and profit targets. Since it is a separate legal entity, it also limits your liability to the contributions made to the registered capital of the WOFE. A WOFE is the favorable option for an overseas company that wants to that wants to enter the Chinese market.
Benefits of foreign-invested enterprises：
1. A WOFE can be incorporated to conduct general business activities in China.
2. It gives foreign investor complete control of the day to day business and decision-making without any compulsory involvement from a Chinese partner.
3. It can engage in any business activities, issue invoices to clients, receive RMBs, convert profits into foreign currency, and repatriate them.
4. It is the most effective way of protecting trademark technical information and trade secrets.
5. It provides complete authority regarding the hiring of staff, and does not require you to hire Chinese staff.
Formalities of registering new company in China:
1. Checking Enterprise Chinese name by Industrial and Commercial Bureau；
2. Prepare the Articles of Incorporation and other docs；
3. Registered by the Industrial and Commercial Bureau；
4. Business license and Certificate of Approval；
5. Open a Basic Bank Account for new enterprise；
6. Commerce Commission for the record of foreign trade operators；
7. Customs consignee and consignor filing；
8. Foreign exchange filing and registration
9. Customs electronic port card registration
Preparation by investor(s):
1. Chinese company name/registered capital/business scope;
2. Individual investor should be present and sign documents with passport;
3. Company investor should prepare notarized business license by Public Notary Office and Chinese Consulate;
4. Nominate Legal Representative, Supervisor and Financial Manager.