Published by ChinaMNC · Chaoyang

Shantou's AI and Computing Power Push: What Foreign Founders Need to Know

Shantou is actively developing its AI and computing power industry, offering opportunities for foreign founders. This article summarizes recent government efforts and outlines practical steps for company registration in China.

Shantou's AI and Computing Power Push: Opportunities for Foreign Founders

Shantou, a city in Guangdong Province, is making strides in the artificial intelligence (AI) and computing power sectors. A recent government delegation visited Hangzhou, Hefei, and Nanjing to attract investment and learn from leading companies. For foreign founders considering setting up a company in China, Shantou's initiatives could present unique opportunities. This article breaks down the key developments and provides practical guidance on registering and operating a business in China.

Shantou's AI and Computing Power Initiatives

The Shantou Municipal Development and Reform Bureau, together with the Overseas Chinese Experimental Zone Management Committee and China Mobile Shantou Branch, organized a five-day investment promotion trip to Zhejiang, Anhui, and Jiangsu provinces. The delegation visited major enterprises such as Hangzhou Iron and Steel Group, Alibaba Cloud Intelligence Group, New H3C Group, Anhui Shenji Technology Co., Ltd., and the Biopharmaceutical Valley Exhibition Center. The goal was to understand advancements in full-stack AI capabilities, cloud computing data centers, chip-model integration, computing server investments, and the integration of digital technology in biopharmaceuticals.

Shantou is leveraging its unique advantages—international submarine cables, offshore wind power, overseas Chinese resources, industrial clusters, and policy pilots—to build a national hub for the "token economy" (词元经济). Notable achievements include:

• In April, the Overseas Chinese Experimental Zone completed the nation's first full-chain commercial closed loop for "token export" (词元出海).
• In June, the country's first cross-border e-commerce intelligent agent "token export" cooperation order was placed in Shantou.
• By the end of September, over 500 related enterprises had settled in the zone, with daily token exports exceeding 100 billion tokens, projected to surpass 500 billion by the end of December.

These developments indicate a growing ecosystem for AI and computing power in Shantou, which could benefit foreign founders looking to enter this space.

What This Means for Foreign Founders

If you are a foreign founder interested in AI, computing power, or related technologies, Shantou's push offers potential advantages. The city is inviting enterprises to collaborate in areas such as:

• Building computing infrastructure
• Developing intelligent agents
• Cultivating data annotation industries
• Establishing pilot testing bases
• Applying AI to transform traditional industries
• Building token export ecosystems
• Applying domestic chips and models

Foreign founders can explore partnerships or set up their own entities to tap into these opportunities. However, registering a company in China requires careful planning. Below is a practical guide.

Choosing the Right Entity Type

For foreign founders, the most common entity types are:

• Wholly Foreign-Owned Enterprise (WFOE): A limited liability company owned entirely by foreign investors. Ideal for businesses seeking full control and limited liability.
• Joint Venture (JV): A partnership with a Chinese entity. Suitable for sectors with foreign ownership restrictions or when local expertise is crucial.
• Representative Office (RO): A non-profit liaison office. Limited to market research and networking; cannot engage in profit-making activities.

Given Shantou's focus on AI and computing, a WFOE is often the preferred choice for foreign founders seeking to operate independently. However, consult with professionals to determine the best structure for your specific business.

Registration Steps and Documents

Registering a company in China involves several steps. While procedures can vary by city, here is a general outline:

• Name Pre-approval: Submit proposed company names to the local Administration for Market Regulation (AMR).
• Business License Application: Submit required documents, including articles of association, investor identification, and registered address proof.
• Seal Carving: Obtain official company seals (chop) from authorized agencies.
• Bank Account Opening: Open a corporate bank account for capital injection and daily operations.
• Tax Registration: Register with the tax bureau and obtain a unified social credit code.
• Foreign Exchange Registration: Register with the State Administration of Foreign Exchange (SAFE) for capital flows.

Documents typically required include:

• Passport copies of legal representatives and shareholders
• Proof of registered address (lease agreement or property certificate)
• Articles of association
• Bank reference letter
• Business plan (for certain sectors)

Ensure all documents are notarized and translated into Chinese where necessary.

Capital Requirements and Licensing

China has moved to a subscription capital system, meaning no minimum capital is required for most companies. However, certain industries (e.g., finance, education) have specific capital thresholds. For AI and computing power businesses, check if your activities fall under restricted categories. Additionally, obtain necessary licenses, such as an ICP license for internet services or a value-added telecom license.

Shantou's focus on AI may offer streamlined processes for tech companies, but always verify with local authorities.

Tax and Compliance

Foreign-invested enterprises in China are subject to corporate income tax (25% standard rate, with possible reductions for high-tech enterprises), value-added tax (VAT), and other taxes. Compliance requirements include monthly tax filings, annual audits, and adherence to labor laws. Consider hiring a local accountant to navigate the tax system.

For AI and computing businesses, ensure compliance with data security and cross-border data transfer regulations, especially if handling token exports. Shantou's pilot policies may provide a supportive framework, but legal advice is essential.

Why Shantou? Practical Considerations

Shantou offers infrastructure and policy support for AI and computing companies. The city's international submarine cables and offshore wind power can provide reliable connectivity and energy. The Overseas Chinese Experimental Zone may offer incentives for foreign talent and businesses. However, as a smaller city, Shantou's ecosystem is still developing compared to Beijing or Shenzhen. Foreign founders should assess whether the local market and resources align with their goals.

Next Steps for Foreign Founders

To seize opportunities in Shantou's AI and computing sector, start by researching the local market and potential partners. Engage with the Shantou Municipal Development and Reform Bureau or the Overseas Chinese Experimental Zone for guidance. For company registration, consider consulting a professional firm to handle paperwork and compliance.

This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.

Call to Action: Foreign founders can contact ChinaMNC on WhatsApp / WeChat at +86 153 1898 8535 for help registering and operating a company in China.