A couple emails between one of my firm’s clients and one of my firm’s China lawyers just landed in my in box. The email from the client asked the following:
Do I need to have a business license to sell our products in China? Someone recently told me that we do, but I was under the impression that we do not. Could you clarify for me?
With respect to your question about the business license, it depends on what you mean by “sell in China.” A Chinese business license is for companies that are resident in China. If you open up a retail store in China and sell goods, you will need a business license. If you are simply shipping product to a third party in China, you do not need a business license.
I have seen too many American and European companies form a company to do something in China that they could have done from America or from Europe without the need for a China entity at all. There will oftentimes be marketing benefits from having a WFOE in China, but a WFOE is not always necessary.
Just thought that you should know.