Why structure matters
The entity you choose shapes what you can legally do in China — earn revenue, hire staff, import/export, or only run liaison work. Choosing wrong means re-doing the setup later, so it's worth getting right the first time.
Wholly Foreign-Owned Enterprise (WFOE)
100% foreign-owned, can operate and earn revenue independently, hire staff, and trade. The most common choice for foreign companies wanting full control of their China operations.
Sino-Foreign Joint Venture (JV)
Shares ownership with a Chinese partner. Sometimes required in restricted industries, and useful when local relationships, licenses, or distribution networks matter.
Representative Office (RO)
Cannot earn revenue — limited to liaison, research, and marketing. Cheaper and faster to set up, suitable for testing the market before committing to a full entity.
How to decide
Map your planned activities — Will you invoice clients in China? Hire staff? Import goods? — to the structure that allows them. When in doubt, an advisor can model the trade-offs before you file.
This article is general information, not legal or tax advice. For guidance on your situation, talk to an advisor.