Relocating to Manila?

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  • #4520
    Anonymous
    Guest

    The Philippines is a beautiful country with lot to offer, whether you are just visiting, or planning to move to the Philippines permanently, you will enjoy breath taking scenery, beautiful and friendly natives, and a generally happy atmosphere.

    Most probably, if you are an expat, you will be based in Metro Manila. Most of us are living in Makati, Taguig or further but more quiet and with less pollution, Alabang.

    The city life is quite noisy, the traffic is 24 hours a day, like the pollution. But Philippines will offer you many possibilities to escape the city during the week ends. Abroad or not.

    For the city lovers, they are many parties, restaurants, places to chill in Metro Manila. It’s just quite complicated to know about it when we arrive.

    That ‘s the reason why we created this website, to help your acclimatation in this city who can be quite aggressiv when we arrive.

    Please visit the guide, put some comments if you think it helped you, or if it can be improved. Or visit our new forum, we will answer all your questions.

    Come to Manila for a “look see” prior to moving. You can start the process of arranging housing, investigating schools (and availability), checking out grocery stores and shopping centers. After a few days, you will have a “feel” for this tropical capital city of the Philippines. Why not a half-day of sightseeing to familiarize yourself with the layout of Manila?

    Preparing to go abroad includes securing important documents, making copies, and a lot of planning. It is vital to make copies of everything and keep it in a separate secure space. It is a great idea to take 3 copies of your passport, visas, and other paperwork that is facilitating your move. Keep one with you, one in an accessible, but safe place (ie safe deposit box), and one that is with a trusted relative of friend that can give you the information if something were to happen to you or the other copies.

    A checklist of other things to consider:

    Passports: check expiration- must not expire within 6 months of your arrival. Make at least 2 copies and keep one in a safe place separate from your original passport.

    Secure medical insurance and possibly travel insurance to prevent unmanageable medical bills and enable entry into other countries.

    Research and apply for a Visa. This can take several months to obtain before you leave.

    Save enough money to support your cost of living and lifestyle plus travel costs with enough of a buffer to be prepared for the unexpected.

    Bring things to facilitate transition like a universal electric plug adaptor, any medications you take, or anything else to make you comfortable during the transition.

    #4813
    Anonymous
    Guest

    The Philippines is a beautiful country with lot to offer, whether you are just visiting, or planning to move to the Philippines permanently, you will enjoy breath taking scenery, beautiful and friendly natives, and a generally happy atmosphere.

    Most probably, if you are an expat, you will be based in Metro Manila. Most of us are living in Makati, Taguig or further but more quiet and with less pollution, Alabang.

    The city life is quite noisy, the traffic is 24 hours a day, like the pollution. But Philippines will offer you many possibilities to escape the city during the week ends. Abroad or not.

    For the city lovers, they are many parties, restaurants, places to chill in Metro Manila. It’s just quite complicated to know about it when we arrive.

    That ‘s the reason why we created this website, to help your acclimatation in this city who can be quite aggressiv when we arrive.

    Please visit the guide, put some comments if you think it helped you, or if it can be improved. Or visit our new forum, we will answer all your questions.

    Come to Manila for a “look see” prior to moving. You can start the process of arranging housing, investigating schools (and availability), checking out grocery stores and shopping centers. After a few days, you will have a “feel” for this tropical capital city of the Philippines. Why not a half-day of sightseeing to familiarize yourself with the layout of Manila?

    Preparing to go abroad includes securing important documents, making copies, and a lot of planning. It is vital to make copies of everything and keep it in a separate secure space. It is a great idea to take 3 copies of your passport, visas, and other paperwork that is facilitating your move. Keep one with you, one in an accessible, but safe place (ie safe deposit box), and one that is with a trusted relative of friend that can give you the information if something were to happen to you or the other copies.

    A checklist of other things to consider:

    Passports: check expiration- must not expire within 6 months of your arrival. Make at least 2 copies and keep one in a safe place separate from your original passport.

    Secure medical insurance and possibly travel insurance to prevent unmanageable medical bills and enable entry into other countries.

    Research and apply for a Visa. This can take several months to obtain before you leave.

    Save enough money to support your cost of living and lifestyle plus travel costs with enough of a buffer to be prepared for the unexpected.

    Bring things to facilitate transition like a universal electric plug adaptor, any medications you take, or anything else to make you comfortable during the transition.

    #5541
    Anonymous
    Guest

    This is a question about the scope of activity an RO can take on in China, versus setting up a WFOE. It’s a question about a small company who exports $50k AUD of product a year from China, and who is looking to spend that $50k AUD a year on doing it ourselves in China, as apposed to paying some other Chinese company.

    I’ve done a bunch of research, including a 3 weeks research assignment to China. I’ve just returned. I’ll be heading back over there in 2 weeks.

    My Australian company, for or the last 6 months, have outsource the production of a very simple “widget” to China. This widget is custom-ordered, meaning when we receive an order (for one widget) from our client, we order from China. Twice a week, all the orders are shipped back to Australia for distribution to our clients. We export about 100 of these a week and we spend about $1,000 AUD per week on the production. Shipping is about $3,000 per week as these are light, but bulky items.

    The biggest opportunity is that in 6 months we’ve gone from just an idea and a website to turning over $2k a week in sales. This is growing rapidly. The biggest issue, time and time again is maintaining quality standards and getting these fragile things packed properly. Big headache.

    I say the “production of”, rather than the “manufacturing of” because this widget can be produced very easily. It requires no special manufacturing equipment, are put together by hand, and only takes up a lot of space if we receive a lot of orders. In fact the space to do packaging and to store packaging supplies is the biggest component!

    We’d like to do the production of these in China ourselves because after about a $10k AUD setup, it’ll cost us about the same each year ($50k AUD) to have our own office, employ a couple of people, buy our own supplies and put these things together. The benefit is that we’ll finally be able to control quality and perhaps capitalise on other opportunities in the region. And, as we grow, we’ll save money because this product is labour intensive and labour in China, as you know, is very affordable! If it doesn’t work, we’ve really only lost the setup cost and my time, as owner. The business in Australia suffers very little without me there as I’ve spent many years making it so I can easily step back. And hey, I get to live in China for a while if all goes well.

    Ultimately, I want to look at setting up an WFOE in China however given that the production of these products is really simple, I’m really hoping an RO can handle it – and handle it legally. We only need to employ a couple of people, need about 100 SQM of office space. Packaging is 50% of the space / work (and my understanding is that packaging is allowed as a function of an RO). So it’s the other 50% (a couple of people putting these things together made from two basic materials sourced locally) that MAY cause a problem should we get audited.

    The purchase of the two basic materials would be done directly from our Australian company and we don’t want to sell locally.

    Anyone have any ideas if an RO is all we need?

    You might ask why don’t I just set up a WFOE…

    Our customers pay us and then we pay China for the production. So, while we have good cash-flow, we don’t have a bucket load of money in the bank. Setting up a WFOE requires a lot of capital – capital that one, we don’t have and two, is really not needed when producing custom-ordered, single-item widgets. For paid up capital, we can initially inject $10k for the office setup and then $50k over a year, but my research suggests that’s not nearly enough to get a WFOE approved.

    Does anyone know if I could register a WOFE with that kind of capital?

    If you’ve read this far, wow… thanks. I truly hope I can contribute to this forum and answer other’s questions – once I know something useful!

    #5542
    Anonymous
    Guest

    So after three weeks of research in China you did not realize that a RO could not engage in any real activity in China? Do you actually mean you want to do manufacturing under a RO??

    If you are short on capital…Then just continue to have the Chinese manufacture it for you. A RO would come handy if you want to have staff on the ground for inspection/QC etc.

    #5543
    Anonymous
    Guest

    Thanks for your reply /profile/57-cylon/?do=hovercard” data-mentionid=”57″ href=”<___base_url___>/profile/57-cylon/” rel=””>@Cylon

    I initially went to China to sort out the quality issues with the current supplier. While I was there I researched further.

    If we have an RO so we can employ someone to maintain quality, then we have to rent a premises for a year. If we have a premises and one employee, and we can do all the packaging at the RO, then we’re only one step away from putting these things together (“manufacturing”) ourselves.

    So it’s about whether the “putting together” of these things would be considered “manufacturing” or whether we can convince the authorities that max of 300,000 RMB in the next 12 months can be put into a WFOE.

    I’m not sure which envelope to push – the scope of the RO, or trying for a WFOE with 300,000 RMB ?

    #5544
    Anonymous
    Guest

    The point you are missing is that it is illegal for a RO to engage in any type of business activity beyond serving as liaison office for its parent company in China. You can’t do any packaging under the RO. You can’t buy any items for production nor can ship out manufactured products under the RO.

    Considering the current crackdown and harder restrictions on ROs in China, I would avoid going beyond the legal scope of activities you are authorized to. It used to be OK for service providers, but for products it would be a big no-no.

    #5545
    Anonymous
    Guest

    Hah, yeh I figured I’d annoy someone with this post… I’ve read a thousand posts and just couldn’t find an answer. Much like, heaps of people saying you can’t package and ship with an RO and then heaps of people saying you can. So hard to get the right info.

    Out of ALL my research you are the first person to mention a Class A building. Never even heard of that… off I go to research that now.

    These things are sooooo labour intensive. We do make these in Australia but have to sell them at much higher prices to cover the massive labour cost. We set up a website selling them at half the price (and manufactured in China) and make $500 a month instantly. Then quality issues kicked in. Paying Chinese staff (even through a FESCO) still works out cheaper.

    EVERYONE has been telling me… set up an RO and employ someone for quality checking… but like I said, the expense of doing that means we may as well continue to do it in Australia, but it means we have to stop selling the “low cost” ones. So we either spend money and push ahead with China or lose all those sales.

    I’m looking for a way to get this done in China where we can manage quality without injecting massive amount of capital just to meet WFOE requirements. It seems it may not be possible because of China’s capital requirements.

    But then again, I’ve heard from people that you start a manufacturing WOFE with only 100,000 RMB…

    I paid $450 an hour to an Australia lawyer who apparently was an expert on this and stopped after 1 hour because they couldn’t answer these basic questions.

    If you can point me to somewhere on this forum with the answers to my specific questions, great. I tend to think like most things in China, there are no real answers.

    Mei ban fa.

    You have certainly entertained me. I couldn’t help but laugh at your cynical (and justifiably so!) attitude 

    I dunno… All I know is, I googled everything from Class A RO China to Representative Office Class A, etc… and the only two links I found on the first two pages of google were one to this forum where this guy called leidelaohu was ranting about how hard it is to set up an RO (hehe), and a PDF from some random website.

    I’m sure an RO is NOT the way to go. A WFOE might be the way to go, if I can have $50k or less capital paid over 1 year.

    I do know 100% (well 99% because I’m not god), that the labour cost in Australia is way too high. I also know that at half the price it’s a winner product, proven by our instant success and growth when offering the “low cost” option.

    Damn China for being so… China-ish !

    I’m lucky in that I can leave the business here in Australia and hang out in China for a month and see what happens. I just wish I could some answers before I go. And yes, I’ll be looking in SZ, DG, GZ areas in the south ultimately.

    I’m thinking maybe just to strike up an arrangement with one of our suppliers who has 50 SQM they can sub-rent to us. They employ a couple of extra staff under my control, I pay them some agreeable amount to make it happen. That way, I just pay my supplier money for everything, no new RO / WFOE needs to be set up, no export licences for me to deal with, and we all live happily ever after.

    I’ve seen heaps of smaller companies go to places like Singapore for production and I often think they go there because it’s just easier than going to China. Maybe I’ll join them in Singapore but I’d like to fully explore the options in China first.

    #5546
    Anonymous
    Guest

    /profile/56-afox/?do=hovercard” data-mentionid=”56″ href=”<___base_url___>/profile/56-afox/” rel=””>@afoxwhy does it have to be China?

    From what you have said the purpose of choosing china is the cost of labor. It sounds like your product is very labor intensive, but otherwise requiring unskilled labor. You are also saying 100% of your product is exported back to Australia?

    If this is the case, I would highly recommend checking out Philippines and their PEZA regulations. The basics are you can operate a foreign owned business. All your imports (raw materials) and exports are tax free and pass through PEZA instead of regular customs. The business is entirely tax free, and the only requirement is that you agree to use local labor. The manufacturing wage here is currently at 297peso a day (around $6 USD ) and the labor laws are heavily slanted to that of the employer.

    While the country has a reputation for bad corruption (not as bad as China IMHO) being PEZA registered means you do not have to answer to any other government organisation, and everything is taken care of by PEZA.

    I currently operate a mobile phone remanufacturing facility here – its labor intensive, and we have cut costs by 50% since moving it from Shenzhen last year. – PM me if you want to know more.

    #5547
    Anonymous
    Guest

    Ha yes, great question! Why China!

    It was more a “why not China” type of scenario. We initially found a supplier on Alibaba 6 or 8 months ago and maybe it was luck, but it was cheap, good quality, we could pay AFTER receiving the goods and halved our costs instantly. And yes, we’re only selling to Australian customers.

    So I had no problem paying $2k to fly over there for a week or two and see what other possibilities were in China.

    But if I can’t set up a WFOE with less than (a very justifiable) 500,000 RMB in the first 12 months, then the party for me in China is basically over. I’m finding it really interesting that if China demand a minimum of $250,000 USD or whatever, it basically precludes any business with a turnover of under 1 or 2 million a year to do any kind of production in China. Seriously?

    So yup, Singapore is where some of our competitors go, but I could just as easily look in the Philippines or Vietnam.

    I’ve spent the last 6 to 8 months working with China that to start all that research again in another country would probably drive me crazy. But also, I’ve got my fingers in a lot of pies and there’s all sorts of other production we can do, products we can launch, etc. Vietnam might be great for this one product we’re working on at the moment, but I think China might have more overall potential for future ventures.

    I really want to see if I can make China work before looking elsewhere.

    #5548
    Anonymous
    Guest

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

    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.

    #5549
    Anonymous
    Guest

    I am currently setting up a WFOE. From my application that my local consultant made, The minimum capital transfer is 15% within 3 months of business license release. 100% of capital must be cleared within 2 years. Also I heard the minimum capital is 1 million RMB (not sure as I am not registering this amount).

    Or, you could buy a local company. However, you must keep the local person as the registered person. This works too for smaller scale projects.

    #5550
    Anonymous
    Guest

    What about the laws and regulations that apply to companies? My partner says that as a WFOE, you have to strictly respect the laws. I think that if you’re a Chinese company (or buy one), you can go around many of the rules. Has somebody had this kind of legal issues?

    Fsttrp, what do you mean with small scale projects?

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