How to Start a Company in China in 2026: A Complete Guide

Looking to start a company in China? You'll be tapping into one of the world's biggest opportunities.

China's GDP reached RMB 33.42 trillion (approximately USD 4.87 trillion) in Q1 2026, growing 5.0% year on year — 0.5 percentage points faster than Q4 2025, with the National Bureau of Statistics of China (NBS) describing the economy as getting "off to a good start." 

But a market this large comes with complexity. Setting up a company in China means navigating detailed licensing requirements, language barriers, and a business culture built on relationships.

This guide outlines the 10 steps to launching a company in mainland China and alternative if it’s not feasible for you. 

Step 1: Decide on Your Company Structure

If you're planning to do business in China as a foreign investor, you'll need to select a legal business structure that aligns with your goals and the type of business activities you plan to carry out.

The Wholly Foreign-Owned Enterprise (WFOE) is the most popular choice. Here are the main legal structures available to foreign investors in China:

Step 2: Choose Your Business Location

Careful consideration should be given to where you start your business in China, as it can directly affect your setup timeline, compliance burden, and access to skilled local talent.

China operates multiple Free Trade Zones (FTZs), created to attract foreign investment through simplified customs, tax incentives, and streamlined regulations. 

But they're not all alike. Established FTZs (e.g. Shanghai) are highly competitive but offer better infrastructure and investor services. Other FTZs may offer lower costs and fewer restrictions, making them suitable for early-stage or service-based businesses. 

The right location depends on your industry and goals. Tech firms may thrive in Shenzhen or Hangzhou, while trading companies benefit from port cities like Guangzhou.

Step 3: Declare Your Registered Capital

While China no longer enforces a statutory minimum registered capital (MRC) for most businesses, you still need to define a capital amount when forming your company. This amount acts as a financial commitment and may influence how authorities assess your company's credibility and operational capacity.

The 2014 revision of China's Company Law removed fixed capital thresholds for most entity types, except for regulated sectors like finance, education, insurance, and securities. That said, many local authorities and banks still expect to see a realistic amount of capital based on your planned activities.

Here's what most businesses use:

• RMB 30,000 for multi-shareholder limited liability companies
• RMB 100,000 for single-member limited liability companies

China follows a subscribed capital model, meaning you don't need to pay the full capital upfront. Under Article 47 of China's revised Company Law, shareholders must fully pay their subscribed capital within five years of incorporation.

Step 4: Prepare and Legalise Your Documents

Before applying for your business license in China, you'll need to prepare a set of key documents and company details. These will be submitted to the local Administration for Market Regulation (AMR) and other relevant authorities.

Here's what you'll typically need:

• Approved Company Name: Register your company name through AMR's online system. Most businesses must have a Chinese name.
• List of Shareholders: Identify all shareholders, including their ownership percentages. All listed individuals must be legally eligible to hold shares in China.
• Organisational Structure: Provide a breakdown of your company's structure (e.g. board of directors, general manager, legal representative, supervisors).
• Identification Documents: Submit passports or national IDs for all shareholders, legal representatives, finance managers, and designated contact persons.
• Articles of Association: This internal document outlines your company's business scope, management rules, and profit distribution.
• Registered Capital and Total Investment: Declare your committed registered capital and any planned third-party investment (e.g. loans or external funding).
• Business Address: Provide a local Chinese address with a contact phone and email. Proof of address may also be required (e.g. lease or utility bill).
• Business Plan: Submit a comprehensive plan covering your objectives, strategies, feasibility analysis, and operating budget. Authorities will use this to assess your company's financial viability.
• Parent Company Documents (if applicable): If your business is a subsidiary, you must provide the parent company's business license or registration certificate, translated into Simplified Chinese and notarised.

Step 5: Finalise Company Details and Prepare for Registration

Once you've decided on your company's structure and internal setup, it's time to finalise the information and prepare for registration.

You'll submit these details through the online pre-approval system managed by your local AMR. This includes uploading scanned IDs, your office lease agreement, and any other supporting documents. The AMR will review the submission and may request clarification or revisions before moving forward.

After pre-approval, you should collect original signatures and prepare for the formal application in the next step.

Step 6: Register Your Company with the AMR (Company Formation)

Once your documents are ready, the next step is to register your business entity with the Administration for Market Regulation (AMR).

You can apply for a "5-in-1" business licence, which combines multiple registrations into one streamlined certificate. This licence allows your company to legally operate, invoice clients, and hire employees.

The 5-in-1 licence includes:

Your business licence will also include a Unified Social Credit Code – a unique 18-character identifier that replaces older standalone codes. This code is used across all administrative systems, covering everything from tax filings to contract registration and government reporting.

Step 7: Get a Company Chop

In China, businesses are required to obtain an official seal, commonly known as a company chop. This round stamp typically features your company's registered Chinese name and serves as a legally binding signature on contracts, bank documents, and government filings.

To obtain your chop, you must register with the Public Security Bureau in your local district. This step can only be completed after your business licence has been issued by the local AMR.

Step 8: Open Corporate Accounts 

Once your company is fully registered, the next step is to open the necessary bank accounts.

You'll need to open a foreign capital account to receive your registered capital in foreign currency. This account is used to inject foreign direct investment into the company. Once received, the funds can then be converted into RMB and transferred into a local RMB account, which will be used for daily transactions, payroll, and tax payments.

Opening these accounts typically requires submitting your business licence, Articles of Association, company chops, and office lease. In many cases, the legal representative must be physically present at the bank. Processing times can range from several weeks to months, depending on the bank and location.

Step 9: Register for Taxes, VAT and Social Security

Within 30 days of incorporation, your company must complete all relevant tax and compliance registrations with the State Taxation Administration (STA).

This includes:

• National and local tax registration, including selecting your VAT (value-added tax) status. Most businesses require either general VAT taxpayer status (which allows you to deduct input VAT) or small-scale taxpayer status (with simplified reporting).
• VAT (fapiao) registration, to enable your company to issue official tax invoices required for B2B transactions.
• Social security and housing fund registration, which covers mandatory contributions for Chinese employees across pensions, medical insurance, unemployment, and housing funds.
• Work permit registration via the State Administration of Foreign Experts Affairs (SAFEA) online system, required before hiring any expatriate staff

VAT is generally 13% for most goods and some services; 9% for construction, utilities, agriculture, and real estate; and 6% for most modern services.

Step 10: Obtain Additional Licences and Protect Your Intellectual Property

After incorporation, certain industries in China require sector-specific approvals before starting operations. Businesses involved in food and beverage, medical devices, education, or cross-border trade must obtain relevant permits from regulators and register with bodies such as the State Administration for Foreign Exchange (SAFE) or Chinese Customs. Identify these licensing requirements early, as delays can disrupt your go-to-market timeline.

Also, remember to protect your brand by registering your trademarks and patents with the China National Intellectual Property Administration (CNIPA). China follows a first-to-file intellectual property system, meaning legal ownership is granted to whoever registers the mark first, not who used it first. Even if your brand is protected overseas, you won't have legal standing in China without local registration.

Hong Kong: A Simpler Way to Enter the Chinese Market

By now, you know that launching a company in China requires time, resources, and a deep understanding of local compliance. From navigating labour laws to securing the right licences, the process can be time-consuming and even frustrating, especially for first-time foreign founders.

That's why many entrepreneurs choose Hong Kong. It's one of the most accessible places to start a business as a foreigner, offering proximity to China with fewer barriers and a faster setup.

Here's what makes Hong Kong a compelling alternative:

• 100% foreign ownership: Foreign entrepreneurs can own 100% of their company. 
• Faster setup: Incorporating in Hong Kong typically takes 3 to 5 working days, while company formation in China can take 3 to 8 weeks.
• Low corporate income tax: Hong Kong offers a two-tier profits tax system at 8.25% and 16.5%, compared to China's standard flat rate of 25%.
• No minimum capital requirements: Unlike many Chinese entities, Hong Kong companies can be formed without paid-up capital.
• English-language business environment: English is one of Hong Kong's official languages, used in contracts, government filings, and everyday business.
• Regional hub advantage: Tap into Asia-Pacific and China markets while operating under Hong Kong's business-friendly rules.

If you're considering the Hong Kong route, you don't need a local director. However, Hong Kong companies must have a local company secretary and a registered business address. 

Statrys makes it easy to get started. We offer an all-in-one incorporation package that includes company registration, a company secretary, a registered address, and the option to apply for an in-house multi-currency business account — all online and typically completed in 5 business days (subject to approval). We also offer pay-as-you-use accounting services.

Doing business in China is not simple, but through Hong Kong and with a partner like Statrys, it's absolutely possible.