Companies in Brussels

There are several major forms of business which attract foreign capital, advanced technology and modern management techniques to China. Although the joint venture approach is generally preferred by the Chinese, it is not a requirement and foreign companies may set up wholly-owned operations in China. Due to the long time-frame usually needed to negotiate and establish a joint venture, some foreign companies initiate operations as a representative office with the intention of transferring the operations to a joint venture once established. Others make their initial inroads through one of the various forms of trade, rather than getting immediately involved in investment.

Representative Office

A representative office is one of the most common forms of foreign establishment in china. The basic regulatory framework was established by the Interim Regulations of the Peoples Republic of China Concerning the Control of Resident Offices of Foreign Enterprises. Consistent with international practice, representative offices in China may not engage in direct business operations. However, it is widely accepted that such offices may provide liaison services to group companies or even third parties. In such cases, the representative office is subject to Chinese taxes (enterprise income tax and business tax). If the representative office provides liaison and co-ordination, services only to its head office, it is exempt from Chinese tax.