Are You Suitable for Registering a Company in China?

Nowadays, many expats are engaged in business activities in China. Once they need to collect payments, a bank account of a domestic company is needed for legal transactions (excluding salary income).

In order to more conveniently and legally engage in business activities in China, registering a company is a wise choice for some people.

This article lists for you who is suitable for registering a company in China?

1. Those who entered China with a business visa and have long-term cooperation with Chinese companies

Due to the current epidemic, business visa extension is relatively difficult, and business visas with multiple entries and exits are also more difficult to obtain.

If you enter the country with a business visa and have long-term cooperations with companies in China, the transactions between the two of you need to be transferred through a domestic Chinese bank account to be legal.

If you register a company in China, then you could apply for a visa as a legal representative. And you will have a domestic company account for transactions, which is in compliance with the law.

2. Those who hold a student visa and need to collect payment while preparing to start a business in China

Persons holding student visas cannot have income according to the law. Based on our communication with police officers at Shanghai Exit-Entry Administration, if one apply and got indicated "entrepreneurship(创业)" on the student visa, they can have a buffer period of 1 to 3 months before registering a company, and they can legally collect payments without transferring to a work visa.

3. Those who currently hold work visas but want to cooperate with other companies

Once you sign a labor contract with a company and obtain a work visa, you cannot cooperate with other companies as a labor force, and the income is illegal.

If one registers your own company, the company can sign contracts with other companies and earn an additional profit (you cannot hold a visa as a legal representative of your own company while doing so).

RISK WARNING

Although registering a company has the above-mentioned advantages, the registration period is relatively long with many steps, so you need to prepare in advance.

And recently the Exit-Entry Administration Bureau in Shanghai is closely investigating the cases of company registration without actually operating.

Now, the police will verify the registered address on the business license by visiting in person. If the company is not operating in that address, there will be a risk of cancelation of business license and residence permit.

VisaOfChina can now help with the registration of companies in Shanghai and Nanjing, If you have any questions about it or other visa applications, please contact our visa consultant Annie (WeChat ID: AnyHelper-ss).

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