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How to open a company in China

Research notes on opening a company in China and what costs to expect. Use the tabs for regional setup workflows and the financials for rough, city-level cost modeling across 24 China hubs (optional global cities in the dashboard)—illustrative only, not legal or tax advice.

Data as of 2024 Q4. Last reviewed 2026-06. See methodology for sources.

The Setup Process: Step-by-Step

This tab is for international investors—foreign individuals (any nationality; a U.S. citizen founder is a common example) or a foreign parent company—setting up a WFOE—a wholly foreign-owned enterprise (外商独资企业), the usual mainland vehicle for foreign investment. Work the steps in order; optional detail is folded below. Before step 5, confirm your planned CAD/design activity fits your registered scope, the 2024 FI negative list, and any sector licence—not a permit-restricted construction-design category. Budget registered capital (steps 8–9) and operating costs before you file.

Foreign hires on the mainland: payroll generally requires a valid work permit (e.g. Z visa / 工作许可) tied to this entity—not a tourist or business visa alone.

Right column: rough cash-impact hints (2024–2025 style ranges). Not quotes—city, bank, and agent change outcomes. Currency rule: All amounts below are estimated in RMB first (what you pay onshore in China, or planning equivalents for overseas bank/notary lines); switch to English to see USD = RMB ÷ USD/CNY using the same rate as under Financials (live when the feed loads, otherwise a 2024-avg fallback of 7.2). The dashboard chart still follows the same RMB→USD rule when you pick USD.

Entity path comparison (at a glance)

Factual summary for planning—not legal advice. Timelines and fees vary by city, sector, and counsel.

Topic WFOE Domestic LLC Sino-foreign JV (FIE LLC) Hong Kong Macau
Legal vehicle Wholly foreign-owned enterprise (外商独资企业) 内资有限责任公司 外商投资有限责任公司 (post-FIL LLC) Private company limited by shares Lda. (有限公司)
Foreign ownership 100% foreign (non-restricted sectors) Domestic shareholders only Foreign + Chinese mix per 2024 negative list 100% foreign allowed 100% foreign allowed
Mainland-based staff Yes — mainland payroll + 五险一金 Yes — mainland payroll + 五险一金 Yes — mainland payroll + 五险一金 No — SAR employment only; mainland staff need mainland entity No — SAR employment only; mainland staff need mainland entity
Mainland VAT fapiao (数电票) Yes — via mainland tax bureau Yes — via mainland tax bureau Yes — via mainland tax bureau No — SAR invoices; mainland clients usually need mainland entity fapiao No — SAR invoices; mainland clients usually need mainland entity fapiao
Typical registration AMR + FDI report; often 2–8 weeks (bank longer) 一窗通; often 1 business day when complete AMR + partner docs; often 4–12+ weeks e-Services ~1 hr to 4 business days CRCBM + notary; ~2–3 weeks
Registered capital Subscribed; 5-year pay-in (2024 Company Law) Subscribed; 5-year pay-in (2024 Company Law) Subscribed + equity split; 5-year pay-in Nominal share capital (often HKD 1+) MOP subscribed per articles (sector rules apply)
Planning setup band (tier-1) Agency ¥12k–40k+; full-service ¥100k+ (see step fees) Agent ¥500–15k+ full-service Legal + agency ¥18k–250k+ Agency ~HKD 3k–10k+ (bank KYC separate) Notary + registration ~MOP 10k+

Engineering Talent Hubs

This section organizes 24 cities across Greater China—the Greater Bay Area, East China, the northern coast, inland & Central Plains, the southwest, and Hainan—so you can compare salary and cost patterns without mixing geography.

Greater Bay Area (GBA) & South

Show or hide regional context for the Greater Bay Area Special about the GBA for AEC teams

The Pearl River Delta ties manufacturing, finance, and design: Shenzhen and Guangzhou anchor large engineering talent pools, while Hong Kong and Macau (SARs) offer different pay and contribution profiles. Zhuhai is a lower-cost GBA entry point at the Macau border.

GBA

Shenzhen

Hardware & Tech capital. High demand, fast-paced CAD talent.

GBA

Guangzhou

Traditional trade/manufacturing hub. Excellent engineering base.

GBA / SAR

Hong Kong

Global finance/design. Highest base pay; lowest modeled employer payroll statutory burden (MPF capped).

GBA / SAR

Macau

Hospitality/Architecture focus. Unique labor market; very low modeled employer payroll statutory (flat FSS).

GBA

Zhuhai

Bordering Macau. Beautiful coastal city, cost-effective GBA access.

East China Hubs

Show or hide regional context for East China hubs Special about East China hubs

The Yangtze corridor combines Shanghai’s international practices, Hangzhou’s digital economy, Nanjing’s civil-engineering depth, Hefei’s advanced manufacturing, and Suzhou’s industrial-park and manufacturing-adjacent design talent—often the most competitive salary bands outside the GBA.

East

Shanghai

Premium international hub. Tongji Univ. architecture talent.

East

Hangzhou

E-commerce/Tech hub (Alibaba). Highly competitive, modern skills.

East

Nanjing

Historical capital. Elite civil engineering talent (Southeast Univ).

East

Hefei

Rapidly rising EV & tech manufacturing center. Excellent value.

East

Suzhou

SIP & manufacturing belt; strong BIM/CAD demand, salaries often just below Shanghai.

North, Inland & Central Plains

Show or hide regional context for north, inland and central plains hubs Special about north, inland & central plains

North & northeast coast: Beijing, Tianjin, Harbin, Qingdao, and Dalian—policy hubs, Bohai/Yellow Sea ports, and the lowest salary bands in this row. Inland & plains: Zhengzhou (Henan / Central Plains), Wuhan (Yangtze middle), Changsha (Hunan), and Xi'an (northwest interior)—large graduate pools and moderate rents. This block is not “Southwest China”; see the next section for Sichuan/Chongqing/Yunnan.

North

Beijing

Political & educational center. Premium salaries, top-tier engineering talent.

North

Tianjin

Major port, ~30 min from Beijing South by intercity HSR (station to station). Heavy industrial design focus.

North

Harbin

Northeast industrial base. Lowest costs, legendary technical university.

North

Qingdao

Shandong coastal port; manufacturing & marine engineering; Grade A office costs above inland peers.

North

Dalian

Liaoning port & shipbuilding heritage; heating season lifts utility load versus south coast.

Inland

Zhengzhou

Henan / Central Plains logistics hub; north–inland corridor; affordable Grade A.

Inland

Wuhan

Yangtze middle hub; huge graduate pipeline.

Inland

Changsha

Hunan capital; engineering & media; central-south inland.

Inland

Xi'an

Northwest interior; aerospace/defense; 3D skills.

Southwest China

Show or hide regional context for Southwest China Special about Southwest China

Southwest here means Sichuan (Chengdu), Chongqing municipality, and Yunnan (Kunming)—the western/southwestern cluster, separate from “Central Plains” (e.g. Zhengzhou) or the Yangtze-middle inland hubs (e.g. Wuhan) above.

Southwest

Chengdu

Sichuan basin hub; high quality of life; strong BIM talent.

Southwest

Chongqing

Mountain megacity; huge talent pool; inland delivery base.

Southwest

Kunming

Yunnan gateway; mild climate; smaller AEC market than Chengdu/Chongqing.

Hainan Free Trade Port (Island)

Show or hide Hainan Free Trade Port policy context Special about Hainan

The whole province operates as the Hainan Free Trade Port. Since the 18 Dec 2025 island-wide special customs launch, qualifying FTP entities importing from abroad generally receive zero import tariff on goods not on the taxable negative list (~74% of tariff lines at zero); VAT and consumption tax follow FTP goods-tax rules—not a blanket “zero everything” for every category. Shipments to the mainland remain subject to “second-line” rules unless substantially transformed on-island. This is aimed at tourism, modern services, high-tech, healthcare, and logistics.

  • Corporate income tax: 15% for qualifying enterprises in encouraged industries with ≥60% of revenue from the encouraged main business plus substantive operations (policy extended in phases; verify end dates with counsel).
  • Personal income tax: Eligible high-end and urgently-needed talent may cap the effective burden at 15% on qualifying Hainan-sourced income (rules for residency and recognition apply; confirm active frameworks with counsel).

Figures below use typical employer social-insurance + housing-fund burdens for Haikou/Sanya; they do not replace tax or legal advice.

Hainan FTP

Haikou

Provincial capital and main policy/admin hub. Stronger pool for corporate, infrastructure, and design roles than smaller island cities; lower typical engineering base pay than tier-1 coastal cities but improving with FTP investment. 15% tax rates require encouraged-industry + substantive operations—not automatic.

Hainan FTP

Sanya

Tourism and hospitality economy; higher cost of living and smaller technical labour market, so CAD/engineering packages often include a retention premium versus Haikou for comparable seniority. 15% tax rates require encouraged-industry + substantive operations—not automatic.

Annual Financial Modeling Dashboard

This interactive dashboard calculates the Annual Total Cost of Employment. It automatically multiplies base salaries by 12 and calculates the localized employer statutory contributions (5 Insurances & 1 Fund / MPF) for all 24 cities. Base salaries follow 2024–2025 hiring surveys (e.g. Liepin, 51job, i人事); office rent uses citywide Grade A/B effective averages from CIH, JLL, Savills, Knight Frank, Colliers (mostly Q3–Q4 2024), with utilities scaled for climate/heating. All figures remain planning estimates, not quotes. Currency rule: City and overhead inputs are stored in RMB; when you pick USD, the chart divides by USD/CNY (live when the feed loads, otherwise a 2024-avg fallback of 7.2)—never the other way around. Optionally add modeled overhead per employee—rent, workspace kit, utilities, and AEC software (see methodology below). Click any city's bar for the micro breakdown. For setup context, see Setup Steps 8–9.

Cross-city bars compare annual employment cost under each jurisdiction’s payroll rules—mainland cities use 五险一金-style loads; Hong Kong/Macau use MPF/FSS (not mainland social insurance). SAR and international bars are not substitutes for a mainland entity when you need onshore staff or mainland fapiao.

Annual Macro Comparison: Junior CAD

Total Annual Cost (Base + Contributions) for 1 employee(s).

Annual Micro Breakdown: Shanghai

Annual Base vs. Employer "5 Insurances & 1 Fund" ()

Mainland Contributions: Employer statutory contributions include Pension, Medical (9% in this model—maternity often merged into medical in many cities), Unemployment, Work Injury, and Housing Fund. Rates fluctuate by municipality; donut slices are illustrative.

Methodology, sources & disclosure

Data sources

Base salaries follow 2024–2025 hiring surveys (Liepin, 51job, i人事); office rent uses citywide Grade A/B effective averages from CIH, JLL, Savills, Knight Frank, Colliers (mostly Q3–Q4 2024), with utilities scaled for climate/heating. Software pricing uses Autodesk AEC Collection public US list (~USD 3,560–3,795/user/year, 2025–2026) and Rhino commercial (~USD 995 perpetual). All figures are planning estimates, not quotes.

Modeling rule

Salaries, rent, contributions, and overhead are stored RMB-first; USD display always divides RMB totals by USD/CNY (live feed when available, otherwise a 2024-avg fallback rate of 7.2). Hong Kong and Macau figures are stored as pre-converted RMB planning equivalents (reviewed Q4 2024)—HK MPF is capped at HKD 1,500/month employer; Macau FSS employer share is a flat MOP 60/month.

Last reviewed

Data as of 2024 Q4; last reviewed 2026-04. Regulatory references (e.g. PRC Company Law revised 1 Jul 2024) are noted inline at the relevant step.

AI assistance

This page was compiled with AI assistance (Gemini 3.1 Pro, April 2026) from the public sources listed above and reviewed by the author. Treat as a starting outline, not as authoritative legal or tax advice.