Minimum paid up for WFOE?

83 views

C
CoolRunner Original post #1
What is the current minimum paid-up for a WFOE company? I was told that the minimum paid-up capital required for a WFOE consulting has been reduced to 100,000 RMB. I remember reading that the minimum required was 200,000 USD.

2 Replies

R
Rich168 #2
Yes some districts do allow 100K registered capital; however, in the registration process, based on your business plan, the approval might take a longer time or even you might even have to increase that registered capital to get the business license. Plus 100K may be a little tight unless you keep your expenses really low and your income comes in immediately. You don’t want to deal with the hassle of having to increase your registered capital because your initial capital has all been spent. In Shenzhen, you can actually register a WFOE with only 30K RMB if there are at least 2 investors…
K
KenXu #3
As for registered capital: Registered capital is the amount that it’s required to run the business until it can break even – the ‘registered capital’ is a guideline only. If you do looking for a minimum registered capital, for instance RMB 30,000 (which is impossible to establish a WFOE in China) this means you will run out of money pretty soon, which leads to increased costs in reapplying for permission to increase capital, additional licensing fees and renewals of business licenses and so on. The WFOE needs funding via it’s registered capital until it’s about to support itself from it’s own cash flow. However the amount of registered capital depends upon factors like the Scope of Business and Location. In reality, local authorities will review the feasibility study report (and check the lease contract) approve the investment on a case-by-case basis; reduced registered capital could be negotiated in some cases. The minimum registered capital guides for various industries according to practice in China, for instance, Beijing, Shanghai, Guangzhou, Shenzhen, are given below: Consulting WFOE RMB 100,000 ~ RMB 500,000 Service WFOE RMB 100,000 ~ RMB 500,000 Hi-Tech WFOE RMB 100,000 ~ RMB 500,000 Trading WFOE / FICE RMB 500,000 ~ RMB 1 million Catering WFOE RMB 500,000 ~ RMB 1 million Manufacturing WFOE RMB 1 million or USD 140,000 The conclusion provided might lead people to think that in China, Registered capital less than USD 140K won’t get approved or been approved but won’t generate profit is misleading. In this thread, the questions is about Minimum paid up for WFOE, not about how much investment that you could break even in China. As for break evenit really depands factors like industry, business plan, office rental, manpower cost etc. You may only break even with investing 1 million bucks for restaurant business in Shanghai; while people may invest 100K RMB begins generate profits during the first 6 months by providing design services. As for manpower investment, people may use up their investment pretty soon.

Sign in to join the discussion.