Set up and run your company in mainland China

01 · ChinaMNC

Why mainland China for San Marino companies

San Marino firms tend to be compact and specialised, often in manufacturing, distribution, design or professional services. Mainland China offers scale, deep supply chains and a large domestic customer base, which is why many small European companies choose to have a direct presence rather than work only through agents.

A local entity can make it easier to sign contracts with Chinese suppliers and customers, invoice in renminbi, hire staff and manage quality control on the ground. For San Marino businesses whose competitiveness rests on close supplier relationships, having a legal vehicle in China can shorten communication lines and support long-term partnerships.

That said, China is not a single market. Rules, licensing and business culture differ by city and province, and costs vary widely. Before deciding, clarify which activities you want to perform, who your customers are and whether a light representative presence or a full operating company fits your plans. A measured approach, starting with clear objectives, usually serves smaller companies better than rapid expansion.

02 · ChinaMNC

Choosing a WFOE, joint venture or representative office

Foreign investors in China generally choose among three structures. A wholly foreign-owned enterprise (WFOE) is a limited liability company owned entirely by the foreign investor. It can conduct permitted business activities, employ staff and invoice customers, which makes it the most common choice for companies that want to operate independently.

A joint venture (JV) involves a Chinese partner sharing ownership. It can be useful where local licences, networks or sector experience are essential, but it requires careful negotiation of governance, capital contributions, profit sharing and exit rights. Equity JVs are less common than in the past, yet they remain relevant in restricted sectors.

A representative office (RO) is the lightest option. It may engage in liaison, market research and quality control but cannot sign business contracts or earn revenue directly in China. For San Marino firms testing the market, an RO can be a low-commitment first step, provided its limited scope matches your goals. Confirm sector-specific restrictions before choosing.

03 · ChinaMNC

The five-step registration process

While details vary by city, the path for most foreign-invested companies follows a similar sequence.

• Step 1: Define the project. Decide the entity type, business scope, registered capital, location and key personnel. Check whether your intended activities require special permits or fall on a restricted list.
• Step 2: Name and pre-approval. Reserve a company name and prepare the incorporation file, including constitutional documents and investor identification, often with notarisation and legalisation or apostille.
• Step 3: Business licence. Submit the application to the local market regulation authority to obtain the business licence, which establishes the company's legal existence.
• Step 4: Post-licence registrations. Arrange company seals, tax registration, bank account opening, foreign exchange registration and, where required, sector licences.
• Step 5: Start operations. Complete capital contribution arrangements, set up accounting and payroll, and register employees for social insurance.

Each step depends on complete documents and local authority processing, so plan for iteration rather than a fixed timetable.

04 · ChinaMNC

Documents to prepare from San Marino

Chinese authorities typically require foreign investor documents that are duly authenticated. For a San Marino company, this usually means the certificate of incorporation, articles of association, board resolutions, the legal representative's passport and proof of the registered office, translated into Chinese where needed.

Depending on the city and the document, Chinese consular legalisation or an apostille may be required. Because San Marino's treaty position can affect which route applies, confirm the current requirement with the receiving Chinese authority or your lawyer before spending on authentication.

• Investor corporate documents, often notarised and legalised or apostilled.
• Passport copies of directors, supervisors and the legal representative.
• Lease or proof of the China registered address.
• Bank reference or proof of funds where requested.
• Chinese translations prepared by an accepted translator.

Keep originals and scanned copies organised. Missing or inconsistent documents are a frequent cause of delay, especially when names, addresses or shareholding differ across papers. A short pre-check with a local adviser can save weeks.

05 · ChinaMNC

Registered address, business scope and capital

The registered address is the company's official domicile in China. It must be a real, documented location acceptable to the local authority, often a commercial office or a permitted shared workspace. Some cities allow virtual or incubator addresses for certain activities, but rules differ and are stricter for licensed businesses. Budget for rent and confirm that the landlord can provide the lease and property documents the authority expects.

Business scope defines what the company may do. Write it precisely: overly broad wording can complicate approvals, while narrow wording may block future activities. Where an activity needs a pre- or post-licence, such as food, logistics or certain services, obtain it before trading. Changes later are possible but add cost and time.

Registered capital is a commitment, not a fee. Under China's foreign investment framework, contribution timing and currency rules apply, and some sectors set minimums. Choose an amount you can realistically fund and document, and align it with your bank account and foreign exchange planning.

06 · ChinaMNC

Banking, tax and visas

Opening a corporate bank account in China usually requires the business licence, seals, identity documents and sometimes the legal representative in person. Banks apply their own due diligence, so prepare a clear explanation of your business, expected flows and counterparties. Foreign exchange registration supports capital contributions and repatriation, but transactions must match the declared purpose.

On tax, foreign-invested companies are generally subject to corporate income tax, value-added tax and other levies depending on activity. Bookkeeping and monthly or quarterly filings are mandatory, and invoices must be issued through the official system. Engage a qualified accountant early; retroactive cleanup is expensive.

For visas, foreign staff typically need a work permit and a residence permit, while short business visits use separate visa categories. Eligibility depends on qualifications, the employer and local rules. Do not assume that holding a company position guarantees a work permit; check the requirements before relocating staff.

07 · ChinaMNC

Common mistakes to avoid

Many difficulties are predictable. The most frequent is treating China as one uniform market and copying a setup from another city without checking local licensing. Another is drafting a business scope that is either too vague or too narrow, which causes problems at registration or later when the company tries to invoice for a new service.

Underestimating document formalities is also common. Names, shareholding and addresses must match across notarised papers, translations and applications. Rushing authentication often leads to resubmission.

• Choosing a registered address that cannot be documented or does not permit the intended activity.
• Committing capital that the investor cannot actually fund on schedule.
• Opening a bank account without a coherent explanation of business flows.
• Delaying tax registration and accounting until after trading begins.
• Assuming a work permit follows automatically from company registration.
• Relying on informal advice instead of licensed Chinese professionals.

A modest, well-documented start with clear compliance habits is usually more durable than a fast launch that later needs restructuring.