WFOE SERIES – SECTION 1.1 – WFOE INTRODUCTION
WFOE Introduction
- Wholly Foreign-Owned Enterprise (WFOE) is an investment vehicle into China.
- Involvement of a mainland Chinese investor is not required.
- There is an increasing amount of WFOEs being set up by service providers.
- Our WFOE Series takes you step by step through the process
A Wholly Foreign-Owned Enterprise (WFOE, sometimes incorrectly WOFE) is a foreign-owned limited liability company. It is a common investment vehicle for foreign individuals or corporate entities looking to invest in China.
The unique feature of a WFOE is that, unlike most other investment vehicles, involvement of a mainland Chinese investor is not required. This can give greater control over the business venture in mainland China and avoid the problems often associated with dealing with a domestic joint venture partner.
WFOEs were originally only available to firms looking to manufacture their goods in China and then export. Particularly within Special Economic Zones that offer tax advantages and relaxed government regulation. However, since China joined the WTO, strict criteria for WFOEs has been expanded. This has led to an increasing amount of WFOEs being set up by service providers.
Admittedly, the application process of a WFOE requires patience and perseverance. The application process of a WFOE usually takes 3 to 6 months. It also has a profound impact on the future potential development of a business. Having said that, Maxxelli have over 15 years’ experience to help make the process as smooth as possible. We have written this series to introduce you to the key steps and terminology of the process.
WFOE Series
