Entity choice (four-way) · Formation flagship · First hire · Negative list · Liquidation.
A representative office may not trade, may not issue operating fapiao, and does not hire PRC staff the way a company does (typically a qualified dispatcher). A WFOE can contract, invoice and employ if the sector is open. There is no “upgrade” button: you incorporate a WFOE and close the RO. An RO is for liaison, market research and HQ support — not a cheap trial of selling. Cost of an RO is not “cheaper forever”: you still rent, dispatch staff and file. JV and VIE are not this page — use entity choice.
At a glance
| Question | Short answer |
|---|---|
| Need fapiao / contracts? | WFOE (if access is open). |
| Need PRC employees on your payroll? | WFOE. RO staff are usually dispatched. |
| Liaison only? | RO can be enough. |
| Can we convert the RO? | No — new company, then close the RO. |
| Four-way tree? | Entity-choice page. |
Scope and legal framework
RO registration practice. A foreign enterprise’s representative office is not a Chinese legal person and may not engage in operational activities. It exists to liaison.
Foreign Investment Law + Company Law. A WFOE is a limited company. Access is a negative-list question first. Capital is a contribution clock — not an RO theme.
Labour / dispatch. PRC staff at an RO are typically employed via a qualified labour dispatcher. Direct employment is a WFOE story — first-hire roadmap.
Practical workflow
- Write down: must we collect RMB and hire?
- If yes and access is open: WFOE on the formation path.
- If liaison only: RO registration + dispatcher.
- If you already have an RO and now sell: incorporate, migrate people, close the RO.
Common mistakes
- Using the RO to take customer money.
- Promising HQ a one-stamp conversion.
- Skipping the four-way page when the real issue is a JV or restricted sector.
Action checklist
- Invoice / hire test written.
- Negative list checked.
- If RO: dispatcher named.
- If switching: WFOE timeline + RO closure owner.
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