Set Up a Representative Office in Haikou,Sanya Hainan China, Establishing Representative Office (RO) in Haikou,Sanya Hainan

Hainan is the smallest and southernmost province of the People's Republic of China, consisting of various islands in the South China Sea. Hainan Island, separated from Guangdong's Leizhou Peninsula by the Qiongzhou Strait, is the largest Chinese island and makes up the majority of the province.

Haikou is the capital and most populous city of Hainan province, China. It is situated on the northern coast of Hainan. Haikou exports substantial quantities of agricultural produce and livestock. There is a small amount of industry, including canning, textiles, rice hulling, and light engineering.

Sanya lies at the southern tip of Hainan Island at Sanya Bay, In recent years Sanya has become a popular tourist destination Numerous international hotel chains are now established in the area.

Company setup in Hainan free trade zone attracts so much attention in these days. As one of China's foremost tourist destinations, and with its year-long warmth, sunshine and beautiful tropical beaches, Hainan is an excellent investment destination for entrepreneurs and businesses. The Chinese central government decreed in April 2018 that HaiNan will open a pioneering free trade zone by 2020, and a similar free trade port by 2025. It is estimated that economic growth will be more rapid than that of the Mainland in the next 5 to 10 years.

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When investors have plans on establishing representative office in Haikou,Sanya Hainan, it is better for them to acquire more information in order to run a successful business in Haikou,Sanya Hainan. Setting up a representative office is the most inexpensive entry form for foreign enterprises to enter the Chinese market. And about 20% of investing clients have chosen Representative Office as their Haikou,Sanya Hainan business entity since setting up a representative office is cost efficient and it requires no capital investment. A representative office basically is to serve as a liaison office between a foreign company and its business partners in Haikou,Sanya Hainan, and to coordinate the parent enterprise activities in Haikou,Sanya Hainan (travel arrangements, promotion etc.). 

Representative offices are applicable for many industries: trading, shipping, consulting, etc. The Chinese government has a name format for anyone who wants to setup a representative office (RO) in China, the format is: country (area) + parent company name + Haikou,Sanya Hainan Representative Office.

Haikou,Sanya Hainan Representative Office Setup-Procedures
Preparing all the needed documents→ fill out the application form→ sign the agreement with TCBC→ pay for the services→ submit all the needed documents→ name reservation→ apply for the business license and work card→ go to the public security bureau for stamp-make→ apply for Organization Code License & card→ apply for Setup license of the Local & National Taxation Bureau.

An RO has no legal personality, meaning it does not possess the capacity for civil rights and conduct, cannot independently assume civil liability, and is limited in its hiring ability. Chinese staff working for an RO, although not limited in number, must be employed through a human resources agency that will sign a contract with the RO on the one hand and with the Chinese staff on the other in order to ensure social security and housing fund contributions are paid on a regular basis. No more than four foreign employees can be hired per RO. Foreign staff working for ROs should have an employment relationship with the parent company abroad, and any disputes should be settled under the laws of that country

ROs are usually taxed on gross expenses with the overall tax burden around 11.75 percent of total monthly expenses; however, these rates may be increased by the relevant tax bureau according to the industry. If the chief representative is a foreign national, whether they stay in China or not, they shall be subject to individual tax based on the income derived from the RO. 

Set Up a Representative Office in Haikou,Sanya Hainan is a big project by itself, which requires financial and time commitments, business management knowledge and China expertise. Identifying a competent agent to manage the complex process will be a cost and time effective way to avoid potential pitfalls

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