A Representative Office (RO) is the China representative of a foreign company.
They are established by a foreign company to represent the parent company to carry out business liaison, arranging guest receptions, strengthening the parent’s relationship with local companies and the government as well as handling local matters such as quality control, product promotion, market research and technology exchange.
An RO can only incur expenses in China and cannot receive revenue.
For foreign investors who are in the early stages of investing in China and who may be unfamiliar with the local market establishing a representative office, with a small number of employees (generally under 10), could be beneficial to initially explore the market, discover business opportunities, expand a corporate image and establish partnerships.
There is no minimum capital requirement for the registration of foreign ROs, which vastly reduces operating costs. Compared to Wholly Foreign Owned Enterprises, the price to pay for establishing a RO is much lower.
After successfully establishing an RO in China you would be able to:
1. Conduct market research for the parent company in the local market in order to gather data and information for promotional materials to target potential clients and trading partners
2. Liaise with local and foreign contacts in China on behalf of the parent company
3. Cooperate with bonded warehouses or import and export companies
4. Authorize the use of the property rights on behalf of the parent companies in China and have the ability to supervise the infringement of pirated copyright
5. Make arrangements for parent company representatives and potential Chinese clients.
For further information on doing business in China please firstname.lastname@example.org