Representative Office vs WFOE in Shanghai

The key difference is simple: a Representative Office (RO) is for liaison and market research, while a WFOE is for real business operations in China.

Representative Office (RO)

• Cannot directly generate revenue
• Mainly used for liaison, promotion, and market research
• Suitable for companies that only want a light presence in Shanghai
• The overseas parent company usually must have existed for at least 2 years

WFOE

• Can legally conduct business in China
• Can sign contracts, issue invoices, hire staff, and receive payments
• Suitable for companies that want full operations in Shanghai

Which one is better?

• If you only need a local presence for communication and market exploration, a RO may be enough.
• If you want to actually run a business and generate income in China, a WFOE is usually the better choice.

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Tannet Group Limited is in its sixth five-year development plan stage, and setting the upcoming two five-year plans. Tannet has been always devoted to providing with business solutions for investors all across the world. Should you have further inquiry, pls feel free to contact Shanghai Tannet at 0086-18101649652, email to tianyinong@tannet-group.com, or visit our website https://tannet-group.net/.