Know more about the wfoe Shangai

You might have heard of this term, WFOE and would have wondered what it actually means. Well, WFOE stands for wholly foreign owned enterprise. It is a company with limited liability and is completely owned by foreign investors. It is quite a famous concept in China and WFOE Shanghai is quite well known. They were originally started for encouraging the manufacturing activities which were focused on exports

WFOE Shanghai:

Since China entered the WTO, the WFO has become more involved and is being used more in the service industry and includes services such as consulting, management, software development, trading etc. Any company that is owned completely or 100% by the foreign company will be known as the WFOE.

The WFOE has a lot of potential in China because the companies try to seek out newer markets in China and it is the hub for most of the world’s top investments. The capital that is registered by the WFOE will be subscribed and also contributed by the foreign investors. There are various kinds of WFOE available and these include:

•  Manufacturing WFOE: These are only allowed the right to manufacture and they cannot do anything else.
•  Consulting WFOE: this is only allowed to give consultation services.
•  Trading WFOE: These would be allowed to do only trading, wholesale or retail or they can have franchisees in China.

Benefits of WFOE Shanghai:

• These will have the freedom and the independence for implementing the strategies that are used by the parent company and will not have to involve the Chinese counterparts.
•   They will be able to carry out the business and not just function as the office representative. They can also issue invoices.
•  They can also convert the RMB profits into USD for the purposes of remittance to the parent company.
• The intellectual knowledge and the technology will be protected.
•  No requirement for the license for export import will be required for own products.
•  Human resources can be completely controlled without any kinds of interference.
•  And, it can lead to greater efficiency in the management, operation and all other future development.