Huizhou company formation(WFOE) refers to establish a WFOE in Huizhou. WFOE stands for Wholly Foreign-Owned Enterprise, which is a privately owned company in China that all shareholders involved are foreign. It is a highly favored investment model as the foreign parent company exercises full autonomy and control.
Huizhou is a city in southeast Guangdong Province, China. It forms part of the Pearl River Delta megalopolis. Huizhou borders the provincial capital of Guangzhou to the west, Shenzhen and Dongguan to the southwest, Shaoguan to the north, Heyuan to the northeast, and Shanwei to the east. The city has launched a new work system as it makes efforts to create a better environment for businesses. Under the new system, "chief service officers" (CSO) are introduced to help businesses solve their problems and difficulties.
Different Types of WFOE
Generally speaking, there are mainly three different types that you can choose, namely,
(1) Manufacturing WFOE, which allows you to set up a manufacturing facility in mainland China.
(2) Consulting WFOE, which allows you to provide consulting services.
(3) Trading WFOE, which gives you both import and export licenses and you can also trade locally.
Company Name Approval
One of the first steps for foreign companies is to decide on an appropriate name for the Chinese market. The key pieces of legislation governing this are the Regulations on Registration and Management of Enterprises Name and the Implementation Measures on Registration and Administration of Enterprise Names, which detail how a Chinese company name should be structured.
Office Location Selection
As the company name contains the city of registration, careful consideration should be made before engaging an estate agent or landlord. In some cases, the city name can affect operations, as certain city names carry prestige and credibility that may impact sales, business development, and governmental relations.
Determination of Registered Capital
Registered capital refers to the amount of capital that would be sufficient to support a WFOE’s activities for a minimum period of one year after establishment. The WFOE’s registered capital shouldn’t be too little, which would lead to rejection of the enterprise application and risk insolvency. It shouldn’t also be too much, leading to idle funds and missed opportunities. The sufficient amount of capital varies based on such factors as the WFOE’s industry, the region of incorporation, among others.
Requirements on Company Member
According to Company Law, all WFOEs should have at least one supervisor who oversees the performance of company duties by its directors as well as top management personnel. To avert any conflict of interest, all directors and the senior management personnel are not allowed to concomitantly act as supervisors. A relatively small company with a few shareholders can have one or two supervisors. However, bigger companies are required to have a board of supervisors of not less than three members.
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