China Company Formation: Management Structure Matters

作者:Beata 發表日期:2017-08-10 15:00:51

Many believe that forming a China WFOE consists mostly of filling in lines on an application and submitting it to a China government office and then sitting back and waiting. If you share this belief you are, among other things, completely ignoring all that goes into deciding how to manage the WFOE once formed. I was recently cc’ed on the below email a from one of our China lawyers to a client explaining to the client the initial issues involved in determining a WFOE’s management structure bvi company setup:

We will need to determine how to set up management of your WFOE. The issues are below.

The Chinese system is different from the U.S. system. Under the Chinese system, the person who represents the company for execution of contracts and for execution of government reports and similar is not the CEO/President selected by the board of directors. Rather, the Chairman of the Board/Managing Director is the legal representative of the company and is the person who takes on that role. For this reason, the Chairman/Managing Director is involved in the day to day operations of the company in a way that is very different from the U.S. system where the director does not get involved in day to day management work visa hong kong.

Note also that the role of general manager will be discussed below. It is permissible for the Chairman/Managing Director to also serve as the general manager of the PRC corporation hong kong company formation.

It is not required that any director be a Chinese national or a resident of China china company formation.