There are different types of companies that foreign investors could establish in China, each with its own advantages, featuring different levels of risk, and requiring different levels of resources:
- Wholly Foreign-owned Enterprise (WFOE, 外商独资企业)
- Equity Joint Venture (EJV, 中外合资企业)
- Cooperative Joint Venture (CJV, 中外合作企业)
- Representative Office (RO, 代表处)
- As well as other less common forms such as Foreign-Invested Company Limited by Shares, and Foreign-Invested Partnership Enterprise.
In some cases, only joint ventures might be allowed to be established by foreign investors in certain restricted sectors, as regulated by the Foreign Investment Negative List(see FAQ ‘Are there restrictions for setting up foreign-invested companies in China?‘ below).