Free trade zones in China : A guide

Abstract

China has seen major transformations since the late 1970s when the country gradually stared to open up its economy. Foreign investors have been acknowledging China’s vast opportunities since, as have China foreigner’s expertise and resources, contributing to major mutual benefits. Having seen foreigner’s potential in regards of increased welfare and acquiring new technology, China has been attracting and easing restrictions on foreign direct investments ever since. From a non-Chinese company perspective, this thesis work seeks to explore the opportunities of a China market entry, particularly focusing on what concretely needs to be done for establishing a foreign invested company in China. The city of Shanghai was chosen as target, being China’s center of finance and commerce, but also having recently opened a free trade zone for especially driving new reforms for opening the economy. A company establishment guide will be provided, comparing the process in Shanghai with the China (Shanghai) Pilot Free Trade Zone. The benefits of this specific zone will be studied and compared to policies in Shanghai, to explore whether the zone will offer benefits to foreigners wishing to enter the market. Piloting new reforms to assist China’s transformation and opening up, the China (Shanghai) Pilot Free Trade Zone will introduce a range of opportunities to foreign investors. Results show that the zone provide foreigners with unprecedented market opportunities in previously restricted areas. However as attractive, the regulations need to be truly understood, to fully being able to take advantage.