This service is a core module of China Compliance Risk Review™, designed to support the overall compliance infrastructure for China operations.
In China, the problem is rarely whether a company was established but whether it was structured for long-term control from day one.
For many foreign-invested enterprises, entity setup is treated as an administrative step: registration, banking, seals, and operations begin.
However, many governance and compliance risks can be traced back to one root cause:
The legal and governance structure was never designed for long-term control, HQ visibility, or explainability.
The Entity Setup & Legal Registration module focuses not on how to register, but on a more fundamental question:
Is the China entity structurally controllable from the outset?
Why Structure Matters More Than Process
Once a company is established in China:
Ownership structures are not easily adjusted
Changes to the legal representative carry practical costs
Board and supervisory arrangements shape long-term decision-making
Early “temporary” solutions often become permanent constraints
Many companies later discover that:
Decision-making authority is overly concentrated
Headquarters lacks real legal control
Historical design choices are difficult to explain during audits or transactions
These are not execution errors — they are structural consequences.
Key Areas We Focus On
1 | Alignment of Entity Type with Business Model and Exit Path
Whether the entity type truly reflects business substance
Whether future restructuring or exit scenarios were considered
Whether short-term convenience compromised long-term flexibility
2 | Ownership Structure and Long-Term Governance
Whether ownership arrangements are clear and sustainable
Whether the structure supports future shareholder changes
Whether potential control or explainability risks exist
3 | Controllability of Legal Representative, Directors, and Supervisors
Whether the legal representative role was assessed from a governance perspective
Whether board and supervisory roles provide real checks and balances
Whether excessive role concentration creates structural risk
Common but High-Risk Setup Scenarios
Legal representative, executive director, and GM concentrated in one individual
Ownership structures designed only to meet registration requirements
HQ control relying on trust rather than legal structure
Interim nominee arrangements without clear exit mechanisms
These arrangements may appear efficient at entry, but often become the most costly risks to unwind later.
What This Module Is Not
This module does not include:
Routine company registration services
Standardized templates or checklist-based execution
Legal opinions or compliance certifications
Outcome guarantees
This is a structure- and governance-driven setup module, not an administrative service.
What You Will Receive
Structural risk assessment of the China entity setup
Governance-focused analysis of ownership and roles
Risk observations on legal representative and board design
A defensible structure logic from day one
Position Within China Entry + Governance Package
This module serves as:
The starting point for governance and compliance design
The foundation for authorization, payment, and seal control
The first line of HQ-level explainability and control
In China, entity setup is not the end of a process it is the beginning of who truly controls the company.
We do not make decisions for you; we only help you clarify facts and risks.
Phone : 400 800 7472
Email : info@rtfcpa.com
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