The wholly owned foreign company (WOFC):
From the last few years, the wholly owned foreign company has replaced the joint venture; the foreign capital company is like privileged structure for foreign investment.
There were many unpleasant experiments happened between the Chinese partners and the foreigner sides. The opening of many sectors to the foreign capital very largely contributed to this success.
The WOFC in China is consisted by one or more foreign investors. As in a joint venture, the responsibility for the associates is limited to the amount of their contributions.
There are few advantages for the wholly owned foreign company. In France taxes are the same everywhere, it doesn’t matter where you create your company.That is not the same case in China. The companies with foreign capital can profit some advantages than local companies can not. According to the characteristics of the development area and the nature of your structure created in China, you will benefit from a different exemption of taxes.
1) Wholly owned foreign company in the fields of high technologies, scientists and technical, lately installed in a development area in China, are exonerated from the income tax (during the first two business’s year). During the two next years, the tax can be reduced of x% (according to the zones in which you are established). |
2) The industrial companies, who have exported their production more than 70% of the annual value, can get a reduction of x% for their income taxes, according to the zones in which they are established. |
3) Wholly owned foreign company can cumulate some local advantages and nationals’ ones (it is necessary to make a request somehow). |
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