How Long to Set Up in China? Timeline Compared With Vietnam

Vietnamese investors wanting to open a company in China (to sell, source, or “mirror” a partner) usually ask: “how long does it take?” — and is it as fast as opening one in Vietnam? The answer: China has reformed aggressively (business registration is far faster than before), but foreign investors still face an extra layer (Negative List, foreign-investment reporting) with no Vietnamese equivalent. This article compares company-formation timelines in both countries — step by step, with timeframes.

Opening a company in Vietnam (foreign investor): the timeline

Step 1 — IRC (investment registration certificate): 15–30 days (under Investment Law 143/2025 — projects needing policy approval take longer). Step 2 — ERC (enterprise registration certificate): 3–5 days. Step 3 — Seal carving, publication: 1–3 days. Step 4 — Bank account + DICA: 1–2 weeks. Step 5 — Tax registration, e-invoicing: 1 week. Total: 1.5–3 months from filing to operational (excluding conditional-sector sub-licences). Plus: centralised procedures (one-stop Department of Finance), relatively transparent.

Opening a company in China (foreign investor): the timeline

Step 1 — Negative List check: whether the sector is restricted/prohibited for foreign investors — 1–2 weeks (self-assessment + counsel). Step 2 — Business registration (business licence): filed with the local SAMR (State Administration for Market Regulation) — 5–10 days (China has shortened this sharply; many places run “one-stop”). Step 3 — Foreign-investment reporting (replacing old approvals): a filing (not a permit) — 1 week. Step 4 — Seal carving, bank account: 2–4 weeks (Chinese banks scrutinise foreign-owned companies — anti-money-laundering). Step 5 — Tax registration, invoicing: 1–2 weeks. Total: 2–4 months — slightly slower than Vietnam, mainly on banking (account opening) and the Negative List check. Minuses: fragmented procedures (SAMR, tax, banks, forex — each its own window), the language barrier (dossiers in Chinese), and local variation (Shanghai fast, smaller cities slow).

Head-to-head: five points

(1) Speed: Vietnam is a bit faster (1.5–3 vs 2–4 months) — but not dramatically so anymore. (2) Complexity: China is more complex (Negative List + investment reporting + tight banking). (3) Language: Vietnam works in Vietnamese/English; China is Chinese-first (translators/advisors needed). (4) Cost: China is pricier (legal-service fees, translation, paid-up capital under the new Company Law). (5) Post-formation: both have sectoral sub-licences (see article EXP-2903) — China has more (a denser licensing system).

Registered capital in China: how much is enough?

Under the 2024 Company Law, registered capital must be paid in within 5 years — so the question is no longer “how much looks impressive” but “how much can you actually contribute”. Principles: (1) register enough for 2–3 years of operations (office rent, payroll, working capital) — don’t register 10× what you need; (2) some sectors mandate minimum capital (finance, education…) — check first; (3) too-low capital has costs too — Chinese partners judge by registered capital (RMB 100,000 reads as a “shell”), and banks resist credit lines. Reference points: trading/services offices — RMB 1–5 million; small manufacturing — RMB 5–20 million; large manufacturing — project-based. Note: shareholders remain liable up to unpaid capital — and when the company is indebted, creditors can demand accelerated contribution (“pay up now” on insolvency).

Representative office vs subsidiary: which vehicle?

Representative office (RO): may not conduct business directly (no sales contracts, no invoicing) — only liaison, market research and promotion. Advantages: fast setup (1–2 months), cheap, light obligations (no registered capital, simple reporting). Disadvantages: no business operations — selling requires agents or a later subsidiary. Subsidiary (WFOE/JV): full business rights — contracts, invoicing, hiring. Advantages: complete control. Disadvantages: costlier and more complex (per the timeline above). Selection rule: pure market exploration (1–2 years) → RO; real business (selling, contract-based sourcing) → subsidiary. Common mistake: setting up an RO then quietly doing business (contracts “via” partners) — detection means heavy fines + RO closure.

Special note: China’s new Company Law (2024)

The revised Chinese Company Law (effective 01/07/2024) has key implications for foreign investors: (1) Registered capital must be paid in within 5 years (not “promised” over 20–30 years as before) — registering “impressive” capital means actually contributing it; (2) Legal-representative liability increased — choose your legal representative carefully (this person bears wide responsibility); (3) Tighter corporate governance (audits, disclosure). Meaning: opening a company in China is no longer about “registering USD 10 million to look good” — registered capital = a real 5-year contribution commitment.

The bank-account bottleneck — preparing for scrutiny

Opening a corporate bank account is the slowest step for foreign investors in China — and the least predictable. Why banks scrutinise: anti-money-laundering rules plus capital-flow monitoring — the bank must verify the source of funds, the business purpose, and the controller’s identity. How to prepare: (1) bring complete dossiers (business licence, legal-representative ID, company chop, lease contract, business plan) — translated and notarised where required; (2) the legal representative usually must appear in person — plan travel accordingly; (3) choose a major bank (ICBC, Bank of China, China Construction Bank) with foreigner-experienced branches — small local banks often refuse foreign-owned accounts outright; (4) allow 4–8 weeks and have a backup bank in parallel. Reality check: some banks now require a minimum deposit or existing business relationship — ask before committing to a bank, not after weeks of waiting. And keep every bank document: when SAFE later reviews your capital flows, the account-opening file is the first thing examiners pull. Treat the bank relationship as compliance infrastructure — not just a place to park money, but the backbone of every cross-border flow. Get this wrong and every later step — capital injection, profit repatriation, tax filings — inherits the delay.

Choosing the Chinese city: it matters more than you think

China isn’t one business environment — it’s thirty: (1) Tier-1 cities (Shanghai, Beijing, Shenzhen, Guangzhou): fastest procedures, best professional services (including English-speaking advisors), but highest costs (office rent, salaries); (2) Free-trade zones (Shanghai FTZ, Hainan FTP): pilot policies (faster forex, Negative List relaxations), streamlined administration — worth considering for trading and holding structures; (3) Tier-2/3 cities: cheaper (rent, labour, incentives) but slower procedures and fewer foreigner-friendly services. Rule: for a sales/sourcing office, tier-1 or FTZ (speed and services matter most); for manufacturing, tier-2/3 near your supply chain (costs dominate). Don’t pick the city on incentives alone — a generous tax holiday in a city where you can’t hire or can’t clear customs efficiently is worthless.

Checklist: opening a company in China (Vietnamese investor)

1. Check the Negative List — restricted/prohibited sector? 2. Choose the city: Shanghai/Beijing/Shenzhen (fast, good services) vs smaller cities (cheaper, slower). 3. Prepare capital: registered capital payable within 5 years (2024 Company Law). 4. Choose the legal representative carefully. 5. Hire local lawyers/accountants (Chinese + procedural knowledge). 6. Business registration at SAMR (5–10 days). 7. Foreign-investment reporting. 8. Bank account (thorough dossiers — banks scrutinise). 9. Tax registration, invoicing. 10. Research sectoral sub-licences (see article EXP-2903).

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FLAT Law Firm advises Chinese investors in Vietnam across the full lifecycle: investment structuring, IRC/ERC procedures, tax, labour, intellectual property and dispute resolution. Contact us for advice tailored to your case.

This article has been quality-reviewed by the FLAW AI Legal Council