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set up a representative office in guangzhou china

Set Up a Representative Office in Guangzhou China, Establishing Rep Office (RO) in

Guangzhou, Guangzhou Rep Office Setup Procedures

Brief Introduction to Guangzhou

Guangzhou is situated at the heart of the most-populous built-up metropolitan area in

mainland China, an area that extends into the neighboring cities of Foshan, Dongguan,

and Shenzhen, forming one of the largest urban agglomerations on the planet.

Guangzhou is regarded as one of the central cities of China and core cities of the Pearl

River Delta, Guangzhou has long been the top choice for multinationals for investment

deployment in China since China's reform and opening-up.

With the improvement of industry vitality, infrastructure, business cost, talent and

innovation, the city will attract more global capital, technology, talent and information,

and make itself more internationally competitive.

283 Fortune Global 500 companies, have established their Chinese branch headquarters

in the city. Microsoft, IBM, Samsung and Cisco are among the many that have chosen to

make Guangzhou their home in mainland China.








when investors have plans on establishing

When investors have plans on establishing representative office in Guangzhou, it is

better for them to acquire more information in order to run a successful business in

Guangzhou. Setting up a representative office is the most inexpensive entry form for

foreign enterprises to enter the Chinese market. And about 20% of investing clients have

chosen Representative Office as their Guangzhou business entity since setting up a

representative office is cost efficient and it requires no capital investment. A

representative office basically is to serve as a liaison office between a foreign company

and its business partners in Guangzhou, and to coordinate the parent enterprise

activities in Guangzhou (travel arrangements, promotion etc.). Representative offices are

applicable for many industries: trading, shipping, consulting, etc. The Chinese

government has a name format for anyone who wants to setup a representative office

(RO) in China, the format is: country (area) + parent company name + Guangzhou

Representative Office.

An RO has no legal personality, meaning it does not possess the capacity for civil rights

and conduct, cannot independently assume civil liability, and is limited in its hiring ability.

Chinese staff working for an RO, although not limited in number, must be employed

through a human resources agency that will sign a contract with the RO on the one hand

and with the Chinese staff on the other in order to ensure social security and housing

fund contributions are paid on a regular basis. No more than four foreign employees can

be hired per RO. Foreign staff working for ROs should have an employment relationship

with the parent company abroad, and any disputes should be settled under the laws of

that country

ROs are usually taxed on gross expenses with the overall tax burden around 11.75

percent of total monthly expenses; however, these rates may be increased by the

relevant tax bureau according to the industry. If the chief representative is a foreign

national, whether they stay in China or not, they shall be subject to individual tax based

on the income derived from the RO.

setting up a representative office in guangzhou

Setting up a representative office in Guangzhou China primarily requires 4 stages and

this entire process can take up till 2-5 months time.

- Pre-approval Stage

Once you have decided to base your representative office in which city, the next thing is

to approach the local Ministry of Commerce (MOFCOM) for contacts of a local

designated foreign enterprise service company (FESCO) who will be in charge of your

representative office application process. You should be paying approximately US$800 to

$1000 to a designated FESCO for their service of notifying you on the relevant upcoming

deadlines and administrative procedures. In addition, a signed lease agreement is one of

the pre-requisite for the approval;

Therefore it is vital to secure a lease for a “grade A” office space before submitting the


Stage 2 - Application Stage

Generally your application approval should be done by MOFCOM, but if your industry is

specific to banking, insurance, law, accounting and media, you may have to approach the

relevant authority which has jurisdiction over your industry sector. Once approved, you

should have the Certificate of Approval certifying your legal presence for the next 3

years which can be further extended.

Stage 3 - Registration Stage

This stage is to register for your representative office’s business license which must be

renewed annually. It is important to note that you must complete the registration within

30 days of your approval from stage 2. The application together with the supporting

documents is required to be submitted to the local State Administration of Industry &

Commerce (SAIC and the process normally takes about 1-2 months time.

Stage 4 - Post Registration Procedure

Firstly, In China, it is expected for your representative office to register the office location

with the local police (Public Security Bureau) and to register with local and national tax



Secondly, you should make financial and corporate seals as it is a practise in China to use

them on official documents. Thirdly, opening a foreign exchange bank account will aid to

facilitate overseas fund transfer. Fourthly, to import the relevant equipments or

materials, remember to complete the relevant customs registration. Lastly, get a FESCO

to assist you in recruiting of Chinese staff.

Once all this is done, your representative office is set to establish its presence in China.

However before getting to this stage, a good market research study is required to ensure

that your products or services are viable in the Chinese market.

1 A representative office may, however, negotiate contracts that are later signed in the

name of the home office located outside China.

2 The application letter should contain, in part, the following: a description of the

company’s history, business and scope; the names of the Chairman of the Board, the

General Manager and directors; the names of its major trading partners in China; its

business volume; the proposed name of the representative office; the purpose for

setting up the representative office and the scope of its activities; the duration of the

office and its chief representative.

3 Head office incorporation documents include certified copies of the company’s

business registration certificate, the certificate of incorporation, the memoranda and

articles of association, etc.

4 Other post registration formalities include: registering with the tax bureau; opening a

bank account; completing a residence application with the with the local Public Security

Bureau; applying to the Customs Administration for permission to import office

equipment and daily necessities for use by the representative office and its personnel;

appointing a fesco to recruit local chinese

appointing a FESCO to recruit local Chinese employees; etc.

Set Up a Representative Office in Guangzhou is a big project by itself, which requires

financial and time commitments, business management knowledge and China expertise.

Identifying a competent agent to manage the complex process will be a cost and time

effective way to avoid potential pitfalls

Since 2006, Tommy China Business Consulting has been focusing on consulting services

for our clients to Setting up a Representative Office (RO) in Guangzhou

Please visit

Email:, Skype: tomleeli

WhatSapp/Wechat/Cell Phone: +86 18926401128