One of the methods for establishing a presence in China is setting up a representative office. Although there are some drawbacks to this approach, it provides foreign companies with entry into the Chinese market for conducting research and allows the company to begin establishing its reputation in the country which will make expansion much easier and more successful at a later time. Companies interested in putting together a rep office in the country may be interested in the following steps.

Step 1 – Prior to Approval

First, you will need to determine the city location for your representative office. Although most of these offices are based in first tier cities, more are springing up in 2nd or 3rd tier cities as well so you may want to keep your options open. Second, you will need to find property and get a lease agreement before you can submit your application. You want to make sure the selected space for your rep office is of high quality so that it will pass muster with the Chinese authorities and so it will establish a positive presence for your company in the country.

Besides these steps, you’ll also need to work with a foreign enterprise service company (FESCO). The company’s responsibility is to help you through the process. You can find available companies through China’s Ministry of Commerce. Keep in mind you will need to pay for these services. The average rate is $800 to $1000 USD.

Step 2 – Getting Approval

After you complete your application, you will need to have it approved. For most industries, this is done through the Ministry of Commerce. However, certain sectors (insurance, banking, law, and a few others) require you to go through their authority to be approved. The FESCO you are working with should be able to direct you appropriately. Upon approval, you will receive a Certificate of Approval that is good for at least three years.

Step 3 – Following Approval

Now that you have received approval, you can move forward and obtain your business license in China. This is known as the registration stage which must be completed within 30 days of having your representative office approved by the appropriate authority. Your registration through the State Administration of Industry & Commerce will usually take up to two months to process.

Step 4 – After Registration is Complete

Once the third step is completed, you’ll have to complete a few more tasks before being able to open your representative office:

• Register with Public Security Bureau
• Register with tax bureaus – both at the national and local levels
• Create corporate seals to use on all official documents from your business
• Establish a foreign exchange bank account
• Complete the customs registration
• Get your staff with the help of your FESCO
• Find someone with connections and a solid reputation in China to help you make connections

By following these steps, you’ll be successfully establishing your presence in China within about four to five months.