Wholly Foreign Owned Enterprise (WFOE)

Wholly Foreign Owned Enterprise (WFOE)

The Wholly Foreign Owned Enterprise (WFOE) is a limited liability company wholly owned by the foreign investor(s).

Advantages of WFOE

The advantages of establishing a WFOE include, but are not limited to:
1.Independence and freedom to implement the worldwide strategies of its parent company without having to consider the involvement of the Chinese partner
2.Ability to formally carry out business rather than just function as a representative office and being able to issue invoices to customers in RMB and receive revenues in RMB
3.Capability of converting RMB profits to US dollars for remittance to its parent company outside of China
4.Protection of intellectual know-how and technology
5.No requirement for Import / Export license for its own products
6.Full control of human resources
7.Greater efficiency in operations, management and future development
8.Investor does not have to be established for more than 2 years while Representative Office's parent company is required to have been established for over 2 years.

Business scope

Generally business scope includes investment consulting, international economic consulting, trade information consulting, info and promotion consulting, corporate management consulting, technology consulting, manufacturing, etc.

Registered and paid up capital

Registered Capital: USD$140,000 is a decent investment capital for many types of WFOE.Initial Paid-up could be 20% of the registered capital, with the balance being remitted within 2 years. RMB 100,000 ~ RMB 500,000 (Approx. USD$15,000- 75,000) is the minimum investment capital to be approved for Consulting WFOE, Service WFOE, Hi-Tech WFOE registration.