What Is a WFOE? Wholly Foreign-Owned Enterprise in China
A Wholly Foreign-Owned Enterprise (WFOE) is the most common business structure for foreign investors in China — a limited liability company wholly owned by foreign shareholders with full operational control.
Definition
A WFOE (also called WOFE or外商独资企业) is a Chinese limited liability company registered under Chinese law with 100% foreign ownership. It can conduct business operations, issue invoices, hire employees, and repatriate profits — unlike a representative office which has restricted activities.
Key Features
- Limited liability: Shareholders liable only to the extent of registered capital
- Full control: No Chinese partner required
- Operational scope: Must operate within approved business scope
- Capital requirement: Minimum varies by industry and location (typically RMB 500K–10M)
- Timeline: 4–8 weeks for registration
Registration Steps
- Name pre-approval with AMR
- File incorporation documents
- Obtain business license
- Carve company seal (public security bureau)
- Tax registration
- Foreign exchange registration (SAFE)
- Open bank accounts (RMB and foreign currency)
- Social insurance registration
See also: Company Formation Law Guide | Shanghai Company Formation Lawyers
About the Author
Peter Zhu
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