How to Set up a Management Company in China

Have you ever wondered that start up a management or consultancy business in mainland China to operate relevant professional services to local markets and customers? What business activities (in China, known as: business scope) can be selected and approved by local industrial and commercial registration departments? How to start off as a management or consultant limited company through step-by-step guidance? What corporate types of management companies are popular in Chinese market? This is a right page of industrial guidance if you are searching above related answers. All right, let’s go ahead.

Basic industrial guidance, this article will have related links at the end to explain the requirements of non residents.

The task of management businesses include: providing different professional services to organizations, enterprises and individuals, sounds vague for the definition, because a management corporation has to select it’s industrial description explicitly from specific areas of expertise depending on the industrial subdivision, for example, if you provide management and consultancy services or strategy development expert services to hospitality industries, your company name and business scope will be approved as hospitality management or corporate management, business information consultancy. In the similar way, if you provide engineering cost consultation or construction proposal, your corporate name and business activities will be approved as construction project management and architectural scheme consultation.

If you are wondering that how to set up a Chinese management company, and you have everything to open a business here, also have decided a subdivision of industry mentioned in the above section. Well, following paragraph may answer and explain the details of establishing an industrial management corporation approved by market and supervision department (known as: industrial and commercial administration bureau).

According to the regulations on business registration of enterprises, you have to prepare required documents and information to submit the application of incorporating a business, here SMEsChina lists these useful guidance for your reference. When you decide to start the process, you may place an order to SMEsChina teams to get more assistance.

Step 1. Licensing Approval

1). Approval a name for your management corporation
2). Prepare requirements and documents to verify
3). Obtain an official business license and company seals

Step 2. Corporate Account

1). Submitting of application forms, and corporate files
2). Obtain an approval and issue an account details
3). Apply for an internet banking service and password

Step 3. Starting Operations

1). Apply for the qualification of corporate taxpayer, known as: VAT
2). Issue corporation tax ID and VAT invoice machine by tax office
3). Other operations depending on your corporate decisions

During the process, you have to decide basic conditions and prepare related documents of requirements to verify your authenticity and legality, all legal files and registration information will be identified and approved by the local market and supervision department ( know as: industrial and commercial administration bureau ).

1. Basic conditions

The condition means you have to set up corporate basic structure for key positions, include:
1). Who will be the shareholder(s), known as owner(s), or investor(s).
2). Who will be the legal representative ( know as executive director ), appointed by shareholder(s).
3). Who will be the supervisor, this position cannot be legal person, appointed by shareholder(s).
4). Who will be the financial manager, appointed by shareholder(s).

2. Required documents

You have to prepare the required files for 4 positions to submit verification.
1). Shareholder(s) can be individual(s) or existed enterprise(s), from domestic or oversea.
2). Legal representative, supervisor, no nationality restrictions. A financial manager must be a Chinese citizen.
3). Four positions must provide the required documents.

Need a break? OK. Let’s continue to explain step-by-step.

Hereinbefore SMEsChina teams have mentioned that you must submit business activities from subdivided industries, that means you can not register the corporate name as management limited directly, you must to say, what kind of management, you should make your company name as: Hospitality Management, Restaurant Management, Catering Management, Brands Management, Corporate Management Ltd, or a Construction Management Company and other subdivided industries.

Therefore, the written rules of business activities should be followed the same regulations, here SMEsChina listed some useful information for your selection of business scope. Whatever your corporate structure is, you may get better learning and understanding through our briefly guidance. Reading more: How Selecting Business Scope

Top 10 popular industries of Chinese management companies, Hospitality Management, Restaurant Management or Catering Management, Brands Management, Marine Management, Enterprise Management, Construction Project Management or Building Engineering, Project Management, Health Management Consulting, SCM ( Supply Chain Management ), Sports Management, Marketing Management.

What are the cross industrial selections of business activity, that means you can select different business activities from multiple industries. For example, you can select hospitality management as the first business activity, also you can select trading businesses from other industrial selections such as: hotel supplies sales, kitchen equipment, bedding, decorations, etc. Or other related products of trading.

Centered around management and consultation, there is an undeniable fact that all management corporations based on consulting and services industries ( have mainly been 3rd industry ). Besides cross industrial selections, an industrial management company also can choose more commercial activities from the tertiary industries and focus on professional consultant services such as: education and consulting, business info and advice, architectural scheme consultation, market plannings, talent consultation, ship technical consultation, and other series of consultative services and other business activities.

How to select an available list of business scope, do not worry about that, SMEsChina teams have listed whole subdivisions of industry with different selections.

Because the cultural difference, it is difficult to understand the written rules for non residents without assisting by Chinese friends, so SMEsChina management teams usually suggest our customers to select their business scope from our link mentioned above, then to list available details with Chinese characters in terms of your actual situations of business. Or you may contact our online consultants and lawyers to get more advice.

If you have already understood all required documents and other things you have to set up a management company in mainland China. The whole procedure completed within 20 working days with SMEsChina’s comfortable assistance and online guidance.

In addition, all required documents can be collected and signed in your home country ( no need to travel to China personally ), SMEsChina has great relationships with local register department offices, you do not need to come here in person to interview. Our series of subsequent value-added services can help you expanding and growing local businesses smoothly.

OK, 7 steps to start up a business:

Step 1. Select a company type
Step 2. Choose a company name
Step 3. Decide corporate structure
Step 4. Selecting business activities
Step 5. Confirm registered capital
Step 6. Prepare required documents

The last step is opening a corporate account easily within 3 days. SMEsChina will assist you making a video to open the corporate account.

Recommended guidance: How to Obtain a Business Incorporation Certificate

Naming rules, a subdivided management company name must include the appropriate ending such as, Ltd, LLC, limited, Inc, CO., LTD, etc. And must include registered region ( location of the market and supervision department ) and brand name, industrial description with subdivided selection. For example, if your subdivided industry is Hospitality Management, you can choose the name of China company ( both languages ) as, SMEs ( Shanghai ) Hospitality Management Ltd, or Beijing ABC Hospitality Management Limited, or ABC Hospitality Management ( CHINA ) Limited, etc. About translation for trademarks or brands, you may use google translate tool, or Microsoft Translator, like Amazon in Chinese, is: 亚马逊 ( pronunciation is: ya’ma’xun ). Also you may ask a Chinese friend or our consultant to make some good names.

Look for a registered address, this is a simple question, if you plan to rent a physical ( actual ) commercial office in China, you can use it as your registered address. Another cheaper way, you may contact SMEsChina teams to provide a virtual commercial office address to obtain an approval of business registration and bank account. Learn more: Why Using a Virtual Address

Standard corporate structure, your management and consultation company can be as, WFOE ( wholly foreign owned enterprise ), FICE ( foreign invested commercial enterprise ), JV ( joint venture business ), LLP ( limited liability partnership ) or other structure of company depending on your structure of shareholder(s).

Investment Capital, the minimum registered capital is 20,000 USD or Euro for a Chinese management business. Shareholder(s) can fulfill the obligation of capital injection within 30 years once corporation approved.

Incomes, consulting and management service industries can receive payments from Chinese customers ( local market ) and other countries ( oversea incomes ). Customers can be individuals and enterprises, and other organizations. But you have to pay VAT ( income tax and corporate income tax / known as profit tax ).

Taxing rules, Since 2019, China tax administration published a lot of preferential policies and new regulations of taxation, small scale taxpayer will be approved to obtain tax exemption if monthly income less than 100,000RMB ( 14,800 USD ) apply to management and consultation corporations registered in mainland China. And corporate income tax has reduced to 5% ( yearly profits less than 1 million RMB ). If your Chinese company is a small scale business, you can operate and run business with cheaper costs.

Value-added services for 3rd industrial enterprises

Corporate bank account, one-on-one full services providing account opening and internet banking setting up though SMEsChina accountants department, and offering CPA services to global customers in the field of tax registration, qualification of taxpayer and taxation risk plannings.

Secretarial service, offers mails and letters forward services, recruitment exercise, and foreign exchange procedure, etc., as a Chinese offshore company, you can establish a virtual business entity to sound out China market and test feedback from local clients.

Market opportunities, whatever businesses you look forward to expand in Chinese market, China is a huge market and is attracting more and more small business management enterprises to be here to set up companies with simply and quickly process of establishment. Learn more: China Market Access Strategy

Residence permits, once you own a local enterprise, you can hire foreign staff and obtain working visa and resident permits. And your China corporation can issue an invitation letter to foreign staff from immigration office easily. Read more: Chinese Immigration and Visa

Online marketing, a number of foreign business entities are choosing to deliver advertising in Chinese platforms through local existed corporations, as the largest e-commerce market, online marketing is the the most effective approach to get focus. A Chinese company, can open and register online market platforms ( such as JD, T mall, Taobao, Amazon, Alibaba, etc. ) And payment tools ( such as We chat, Alipay ) easily and quickly ( you must be approved to obtain local business license and corporate bank account ). Read more: How Launching Online Business

Get help deciding: how to set up a business in China

SMEsChina offers a wide range of corporations services through the years of practical experience in areas of company formation, license application, tax consultation, annual audit, government inspection, virtual office services, human resources, secretarial management services, marketing management strategies, residential visa, registration of bar-codes and trademarks, and other solutions of corporate running and maintaining our global customers.

Ready to set up a your management business in mainland China? So are we.

Learn more:

Setting up a Consultancy Business

Company Incorporation of Non Residents

Recommend reading: China Companies Help and Support Center to learn more from a collection of guidance on startup, registration, formation, running and operations for Chinese Companies. Through this page to learn more if you plan to start up a private business in China.