China
Setting up a business in China
China has become one of the major driving forces of the world's economy and after testing the water for many years, a lot of foreign companies are setting up their own establishments in China.
Foreign investors are generally welcome to invest in most businesses in China except specific industries such as media, broadcasting, internet related and some other forbidden or controlled industries.
Companies established in China by foreign investors are collectively referred as Foreign Investment Enterprises ("FIEs").
Forms of FIEs:
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Wholly Foreign-Owned Enterprises ("WFOEs") which are legal entities established in China and are wholly owned by one or more foreign investors;
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Foreign Equity Joint Ventures ("EJVs") which are legal entities incorporated with limited liability jointly owned by local and foreign investor;
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Foreign Cooperative Joint Venture enterprises ("CJVs") which are similar to EJVs but differ in the rights and obligations of each party which are governed by a joint venture agreement.
Foreign enterprises can also set up representative offices (”RO”) in China, but note that a RO is prohibited from engaging in actual business activity. However, if the main activity in China is pure business liaison, setting up a RO is a comparatively simple and more straight forward option.