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Why not China?” That is why a lot of foreigners hereĀ :)

The problem for you to set up a RO is that it would not be cost effective for your situation:

1) Rental: For a RO, you must rent a office located in a business building as you need to show the rental agreement for applying for the RO’s business license, while the rental price is quite expensive in a business building.

2) The rental, the employees’ salaries etc will composed of the total expense of the RO, which would be subjected to pay taxes rated at about 11%.

3) You would not allowed to do the printing/packing by the RO as generally RO is only allowed to do liaise work in China.

Per your email, currently there is no so many business in China for your Company. If you can expect your business to grow in China, it is suggested to set up a WOFE here.Otherwise, you can just outsource your business in China and make the agreements with a printing company and a logistics company properly to meet your requirements and protect yourself against the loss (or even to recruit an agent to check the goods before they are shipped).

For your case,if you would like to set up a WOFE, there are several business models for you:

1) WOFE do the printing -manufacturing company:

a. WOFE buy (import?)canvas and sell (export)the printed canvas to Australia

b. WOFE only provide printing service (the parent company is responsible to supply the raw material-canvas, WOFE will get the service fee as income)

2) WOFE NOT do the printing work–a trading company:

a. WOFE buy canvas, outsource to a printing company and sell the printed canvas;

3)WOFE- a service company

WOFE neither buy canvas nor sell the printed canvas (both of them should be done by Australian company),only provide the quality check services and get the service fee as income.

The lowest registered capital is depending on what kind of business model you are going to choose and where the WOFE’s registration place in Shanghai is as some industry parks have their lowest registered capital requirements. Generally it is USD140,000 for a trading company and USD 200,000 for a manufacturing company. However you only need to inject 20% in 3 months and the rest is allowed to be injected in 2 years.If you choose your business model and the business registration place, I can let you know the related requirements.