Set up and run your company in mainland China

01 · ChinaMNC

Why mainland China for Lithuanian businesses

China is one of the world's largest consumer and industrial markets, with deep manufacturing and supplier networks. For Lithuanian companies, the appeal usually falls into a few patterns: sourcing and quality control closer to the factory, selling goods or services directly into China, providing engineering or design services to Chinese clients, or building a regional presence that supports logistics and after-sales work.

Lithuania sits within the EU trading framework, so your company brings European product standards, documentation practices and customer expectations that can be relevant in Chinese procurement. At the same time, distance, language and regulatory differences are real. A company on the ground helps with invoicing in local currency, hiring, customs coordination and managing suppliers, but it also creates ongoing obligations: bookkeeping, tax filings, capital rules and annual reporting.

The decision should start with a clear commercial case. Define who your Chinese customers or suppliers are, who will run the entity day to day, and how you will fund it. If the case is still exploratory, a lighter structure may be enough at first. If you plan contracts, staff and local revenue, a limited liability company is usually the more durable option.

Plan realistically. Registration is one stage; building a functioning local organisation — banking, tax routines, staff and compliance — takes sustained attention from your head office in Lithuania.

02 · ChinaMNC

WFOE, joint venture or representative office

The three structures most Lithuanian companies consider are the wholly foreign-owned enterprise (WFOE), the equity joint venture (JV) and the representative office (RO). Each fits a different purpose.

WFOE. A limited liability company owned by your Lithuanian parent or by you personally. It can conduct business within its registered scope, issue invoices, hire employees and hold a bank account. It is the most common choice for businesses that intend to trade, deliver services or manage suppliers locally. It requires registered capital, a registered address and ongoing accounting and tax compliance.

Joint venture. A company shared with a Chinese partner. Useful where local market access, licences, land or distribution depend on a domestic partner. Advantages include local knowledge and contacts; the trade-off is shared control, governance complexity and the need for a carefully drafted contract covering capital, board seats, deadlock, exit and intellectual property.

Representative office. A liaison office that cannot earn revenue directly. It suits market research, supplier coordination and brand presence. It is simpler in some respects but still requires registration, a chief representative, an address and reporting, and it cannot replace a trading entity.

Choose based on activity, not convenience. If you will invoice customers or employ staff for revenue work, an RO is unlikely to be sufficient. If a local partner is genuinely essential, structure the JV carefully rather than treating it as a shortcut.

03 · ChinaMNC

The five-step process

Registration in mainland China generally follows a sequence. Exact procedures are administered locally, so your adviser or the local market supervision authority confirms the details for your city.

• Step 1 — Decide and plan. Confirm the business model, entity type, city, shareholders, legal representative, registered capital and business scope. Check whether your planned activities require special permits. Settle the Chinese company name options for a name search.
• Step 2 — Prepare and notarise documents. Gather corporate documents from Lithuania, arrange notarisation and legalisation or apostille as required, and prepare Chinese translations. Documents typically include constitutional documents, shareholder and director records, and identification.
• Step 3 — Secure an address and file registration. Sign a lease for a compliant registered address and submit the establishment application, including articles of association and investor details, to the market supervision authority. Obtain the business licence on approval.
• Step 4 — Complete post-licence formalities. Arrange company seals, tax registration, bank account opening, foreign exchange registration and any sector-specific filings. Capital contributions follow the agreed schedule and rules.
• Step 5 — Start operating compliantly. Set up bookkeeping and invoicing, register employees for social insurance, and establish monthly or quarterly filing routines. Plan work permits and residence permits for any foreign staff.

Allow time between stages; document issues and bank onboarding often drive the pace more than the filing itself.

04 · ChinaMNC

Documents Lithuanian founders should prepare

Document preparation is where many applications slow down. Chinese authorities expect complete, consistent paperwork, and Lithuanian corporate documents usually need notarisation and legalisation or an apostille, plus Chinese translation. Confirm the current requirement with your local adviser, because practice differs by city.

Typical items include:

• Certificate of incorporation and constitutional documents of the Lithuanian company, where the investor is a company.
• Register extracts showing shareholders, directors and legal representative.
• Passport copies of shareholders, directors, the legal representative and the proposed supervisor.
• Proof of registered address in China, usually a lease and property documentation.
• Draft articles of association and the establishment application forms.
• Name options for the Chinese company, with a search check.
• Sector-specific approvals or licences if your activities require them.
• Bank and funding documentation for capital contributions and account opening.

Keep names, addresses and dates identical across every document. Discrepancies between a passport, a register extract and a translation are a common cause of delay. Decide early who will be the legal representative and who will hold authority to sign — this person carries meaningful legal responsibility in China and should be chosen deliberately.

Retain originals and translated copies in an organised file. You will reuse them for bank onboarding, tax registration and later changes.

05 · ChinaMNC

Registered address and business scope

Two items deserve early attention because they shape what the company can legally do and where.

Registered address. Every company needs a compliant address in its registration city. This is not only a mailing point; authorities may require documentation showing the premises are suitable for the registered activity. Options include a conventional office lease or, where local rules permit, a serviced or virtual address provided by an approved operator. Note that some activities and some banks expect a physical office. Confirm that the address can support your business scope and that the lease is signed by the correct party. Changing address later is possible but involves filings.

Business scope. The scope defines the activities the company may conduct, expressed in standard Chinese categories. Draft it to cover what you actually plan to do now and in the near term — trading, consulting, technical services, import and export — without listing unrelated activities that may trigger extra approvals. Some activities are restricted or require pre-approval; check before you commit. Your bank and tax office will look at the scope when assessing your account and invoicing needs.

Registered capital also belongs in this planning. It is a commitment, not a formality: the amount, currency and contribution schedule should match your funding ability and the expectations of banks and counterparties. Set it with advice rather than copying another company's figure.

06 · ChinaMNC

Banking, tax and visas

Banking. Opening a corporate account usually requires the business licence, seals, identification of directors and authorised signatories, address documents and information about the company's expected transactions. Banks apply their own onboarding and may ask about shareholders and source of funds. Prepare clear explanations of your business with Lithuania and China. Foreign exchange registration is part of the picture for capital and cross-border payments, and routine remittances should follow the applicable rules.

Tax. Companies generally register for tax and invoice systems and file regularly, even with no activity. Common areas include corporate income tax, value-added tax, stamp duty and withholding obligations, plus individual income tax and social insurance for employees. Rates, thresholds and filing frequencies depend on your circumstances and current policy, so have a local accountant confirm your position and set a calendar.

Visas. Foreign staff need the correct visa and, for employment, a work permit and residence permit. The process involves the employer and local authorities and should be planned before anyone travels to start work. Short business visits are not a substitute for a work permit. Keep passport, permit and registration details current, and allow lead time for renewals.

Build these routines before you scale. A company that cannot invoice or file on time quickly faces friction with customers and authorities.

07 · ChinaMNC

Common mistakes to avoid

Many difficulties are predictable. Lithuanian founders often encounter the following:

• Choosing the entity by habit. Setting up an RO for revenue work, or a JV without a clear need, creates limits and governance problems later.
• Underestimating documents. Missing legalisation, inconsistent names and incomplete translations delay registration and bank onboarding.
• Treating registered capital as symbolic. Committing more than you can fund, or too little for credibility, causes problems. Match it to your plan.
• Ignoring the address. An unsuitable or undocumented address can block registration or banking. Verify what your city and bank accept.
• Drafting a vague business scope. Too narrow limits activity; too broad invites scrutiny. Align scope with real operations.
• Neglecting compliance from day one. Bookkeeping, invoicing, tax filings and employee registration are continuous duties, not year-end tasks.
• Assuming headquarters control translates directly. Local seals, signatories and legal representative duties need clear internal rules and trusted people on the ground.
• Skipping local advice. Rules are administered locally and change. A qualified local accountant and legal adviser are worth the cost.

Most of these are avoidable with a written plan, realistic budget and a named person responsible for China operations.