How to Get an Entrepreneur Visa in Mainland China?
7 minute read
A number of American companies are still backing out of doing business in China. Consequently, this is creating an economic vacuum that can result in a competitive advantage for non-US companies.
On top of that, the Chinese government has put in a lot of effort to make this country an attractive destination for entrepreneurs all around the globe. Substantial changes have already been made, the IP is now dealt with differently, and there is a law that prevents discrimination of foreign companies in China.
So, how exactly can an individual obtain an entrepreneur visa in Mainland China and reap the maximum benefits of this new business landscape? Keep reading and you will find out.
Entrepreneur visa China
In order to promote nationwide innovation and entrepreneurship, China has implemented certain policies.
At first, the authorities targeted the domestic market and home entrepreneurs. However, the government soon started targeting audiences outside of the borders. The goal of this is to attract foreign nationals.
In 2018, the Shanghai Municipal Public Security Bureau introduced a new type of residence permit called Startup Visa that is also known as the entrepreneur visa.
This kind of work permit allows foreign businessmen to live in China while they carry on with their business endeavours.
It is important to note that the Chinese Entrepreneurship visa is not a separate visa. Actually, it is a residence permit of private affairs with special annotation for entrepreneurship. It has been piloted in various regions throughout China.
With the entrepreneur visa, foreigners can establish businesses in China through a more streamlined process. In other words, an entrepreneur can obtain a work visa with no sponsorship from a previously existing company.
This visa also offers a flexible duration period, with applications available for up to five years.
The requirements vary to a small extent depending on the region where they are offered. But, in general, a non-Chinese person that wants to apply needs to fulfill either of the following requirements.
- The applicant has to provide an innovation plan or a business plan. Also, they have to be a graduate of a Chinese university.
- The person plans to invest in China or provides an innovation plan (a business plan can be a good option too).
To apply for an entrepreneur visa (startup visa), as a student, one has to belong to the following categories:
- International students currently enrolled in one of Shanghai’s institutes of higher education and who have the stated intention to engage in part-time entrepreneurship in “mass entrepreneurship and innovation-accredited” science and technology parks, incubators, and maker spaces in specific areas (e.g. Yangpu District, Changning District, and so on).
- Top-notch foreign students and graduates from Chinese top-level universities or world-renowned universities outside of China who graduated no more than two years prior to applying and who have made excellent achievements in entrepreneurship and innovation.
Once the visa has been obtained, the individuals can:
- Be more flexible to engage in innovation and entrepreneurship in China without needing a full-time job to sponsor the residence permit.
- Engage in the preliminary work related to starting a business for some time before formally registering a company.
- Start their journey towards permanent residence status in China.
All applications require usual documentation including university diplomas, medical check forms, and passport copies.
However, foreign entrepreneurs have to gather specific documents for the entrepreneurship visa, which depend on various criteria.
Individuals who want to invest in China need to submit investment certification forms. Others may need to prove they will work with a business incubator once they arrive in China.
Applicants also have to provide an ‘application letter’ to cover things such as a business plan and a personal statement where they would explain why they desire to build a business in China.
Applying individuals do not need to be sponsored by an already established business and this also means that there is no need to rent an office space or submit a document to prove a capital investment along with other documents.
Instead, applicants need to provide an application letter to express their business intents.
When it comes to costs, if the duration of the visa does not exceed one (1) year, the government filing fee stands at RMB 400.
For visas that are valid between one and three (1-3) years, the fee is RMB 800. Last but not least, for visas that are valid from three to five (3-5) years, the fee stands at RMB1,000.
A business person can apply for the visa before even reaching China. They can also apply even if they are already in China using a different visa.
Once all the necessary documentation is gathered and submitted, it takes about seven days for the application to start being examined.
Contrary to typical work visas, which must be granted and obtained before entering China, an entrepreneurship visa can be granted upon arrival.
Once foreigners collect their visas, they can later be transformed into a local residency permit.
Why Hong Kong is a good alternative
Hong Kong is the region with one of the most attractive tax systems in the world. In that region, the chances of growing a business are high.
However, Hong Kong has looser restrictions when it comes to acquiring a visa. There are no minimum investment requirements specified by authorities.
Still, candidates need to have good educational backgrounds. If a candidate hasn’t studied or has no educational background or related knowledge, the authorities will focus on technical skills and qualifications that need to be provided.
The most important point, in this case, is to prove that a valuable contribution to the economy of Hong Kong will be made. In other words, a candidate should explain how many jobs will be provided for the locals, how many local suppliers and service providers will be involved, and so on.
There is no doubt that China’s business landscape is changing. And it is changing for the better of everyone involved, both local and foreign business owners.
The economic vacuum generated by the companies that have left the Chinese soil is still there and companies can certainly take advantage of it.
However, in order to start your own business there, you should take care of all legal issues and fulfill all requirements stipulated by the laws before starting.