Setting up a WFOE (Wholly Foreign-Owned Enterprise) in mainland China involves specific requirements regarding shareholders, directors, legal representative, registered capital, and other governance roles. Below is a clear and up-to-date (2025) summary:
🇨🇳 1. Definition
A WFOE (外商独资企业) is a limited liability company wholly owned by foreign investors, established under Chinese law. It can engage in commercial, consulting, trading, or manufacturing activities depending on its approved business scope.
🧑⚖️ 2. Shareholders
- Who: One or more foreign individuals or foreign legal entities.
- Ownership: 100% foreign-owned (no Chinese partner required).
- Documents required:
- For companies: notarized and legalized business license from the investor’s home country.
- For individuals: notarized and legalized passport copy.
- Investment ratio: Can be 100% held by one entity or split among several foreign shareholders.
👔 3. Directors / Board of Directors
- Structure options:
- A single executive director (most common), or
- A board of directors with 3–13 members.
- Nationality: Can be foreign or Chinese — no residency requirement.
- Term: Usually 3 years, renewable.
- Appointment: Directors are appointed by the shareholder(s).
🧾 4. Legal Representative (法定代表人)
- Must be a natural person (not a company).
- Can be Chinese or foreign.
- Usually either the General Manager or Executive Director.
- This person has legal authority to represent the company and bears legal responsibility under Chinese law
🧑💼 5. General Manager (总经理)
- Responsible for daily operations.
- Can be the same person as the Legal Representative or a different one.
- No nationality requirement.
💰 6. Registered Capital
- No statutory minimum for most industries since China’s Company Law reform.
- However, local authorities expect sufficient capital to cover 6–12 months of operating expenses.
- Example: service WFOE → usually RMB 100,000 – 500,000.
- Registered capital must be fully declared but not necessarily paid up immediately (can be contributed over several years).
🏢 7. Registered Address
- A commercial office address in mainland China is required.
- Must be verified and approved by the local Administration for Market Regulation (AMR).
Virtual offices are accepted in some zones (e.g. free trade zones) but not everywhere.
For any information, please contact our team to info@opkofinance.com.
