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Posts: 1198

Shifu

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Q: Set up a Service Business, found a company

Hello fellas,

 

I have a running business in Germany providing some services etc. so it's just service branch. Now my german partner and me want to get abroad with our business. We have some interested clients for our service and we need to settle here before we can offer these services. I m pretty sure we are not allowed to operate from germany freely and well it also problematic with communication and traveling etc...

 

So I already gathered some information about founding a company but I am not quite sure about details, so maybe someone can provide me a usefuls link or own experience / knowledge.

 

3 ways:

 

-wfoe: this would make sense because i dont want to get any chinese involved in this. I m not married yet so i also dont wanna my gf own my company...^^. I need 100000 RMB invest captial as far as i know

advantage: all mine

disadvantage: takes a long time to set up, you always have the status "foreign" and always being treated different (bad)

 

-chinese partner:

advantage: easier to set up, faster, less money needed

disadvantage: only 49% of the company is mine, wtf! We all know how trustworthy chinese partners are

 

-office representative: I am not quite sure about this one. I dont think i am allowed to earn money with this and sign contracts

 

are there any other solutions?  (e.g. operating from germany)

 

I still have some time left (6-7month) but we also wanna start as soon as possible.

10 years 34 weeks ago in  Business & Jobs - China

 
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Posts: 1838

Emperor

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It largely depends what service you are intending to offer and what the demands of the service are. If it requires spending substantial periods of time in China, then there is a case for establishing an office here. If you only need relatively short (one or two months) periods in China, you may be best served to keep the business in Germany and operate using a multi-entry business visa. That is absolutely legal providing payment is invoiced from Germany and the Chinese client transfers the capital by bank wire. Should you wish to establish a WFOE or RO in China, the capital can b as little as 5000 euro within two years. But be careful. That level of registered capital is too small to realistically operate a business with. Also note that business licences in China are often restricted to very narrow scopes and you are technically committing an offence by working outside that scope. If your service involves education and training, the government demands will be much higher.Likewise some other specialised areas such as food supply. If you search other recent posts of mine related to businesses in China, you will see that it is entirely a fallacy that business registration of WFOE's takes a long time. As a service provider with nothing more than an office in China, your application would no doubt be very straightforward. From application to business licence will take about 3 - 4 weeks.

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10 years 34 weeks ago
 
Posts: 1198

Shifu

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We provide engineering services. So it would require probably a stay of 2-4 month in a company to finish the project.

Right now I am operating my company from china because i live in china right now and i intended to stay and expand here.

 

Visa and travel cost might  explode if we travel frequently between china and germany (roughtly 900€ per flight).

 

The capital is not what i am worried about. I could set up 500000 rmb as investment without a problem but i am worried about the time it takes to start operating.

 

So if i apply for an service wfoe with just an office here it wouldnt take half a year? that would be great.

for representive offices i read your company need already 2 years of operating with china or in china... well dont fullfil this requirement :/

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10 years 34 weeks ago
 
Posts: 1838

Emperor

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Various people on this very site have claimed that a WFOE takes six months to complete. I have set up one myself and helped two other companies do the same. I guarantee it has never taken more than 3 - 4 weeks. Maybe the area that I operate in is unusually efficient. Anything is possible in China but, if you get stuck, drop me an IM and I will give you more details. I am not an agency or advice centre. You will not be charged for this advice I give. Just prepare a detailed list of questions and I will see what I can do for you.

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10 years 34 weeks ago
 
Posts: 4422

Emperor

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Wumaos and hiring illegal foreigners after the business is finished setting up.

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10 years 34 weeks ago
 
Posts: 1198

Shifu

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thank you  for your help

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10 years 34 weeks ago
 
Posts: 9631

Emperor

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Ask the German Embassy/Consulate what they can help with. Some countries provide support with setting up a WFOE (at a cost) and can also provide office space etc. Since you already live in China you probably have access to Chinese speaking resources that can help with some of the legwork involved, no need to pay the Embassy for running around with documents.  I assume, since you are already in China you would be able to find office yourself, but it can be tricky to find offices for small amount of people, at least for reasonable money. 

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10 years 34 weeks ago
 
Posts: 1198

Shifu

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i dont really need much of an office i was rather speaking of turning my home into my office because at the beginning i wouldnt have any chinese employees anyways^^

 

i ll give the embassy a call, my girl friend is my chinese speaking source Tongue

at least for the difficult stuff i can only speak conversational Oups

 

thank you for your help too

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10 years 34 weeks ago
 
Posts: 8

Governor

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Foreign invested partnership enterprise, google it.

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10 years 10 weeks ago
 
Posts: 115

Governor

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if your clients doesn't need the invoice, you can set up RO. 

 

RO is only for contact and QC, marketing etc. 

 

It is faster and cheaper for you.I think it is the best solution so far

 

Best Regards

Chester

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10 years 10 weeks ago
 
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