Increasing numbers of foreign companies are doing business with China. As business continues to develop, companies at a given time will have to make a strategic decision whether to establish a representation in China. Due to the absence of capital requirements, a straightforward incorporation process in combination with a relatively short timeline and minimal requirements on overhead investments, Representative Offices are an excellent means to test the market in terms of looking for suppliers, customers, for coordinating the foreign parent companies’ activities in China as well as for conducting market research required for developing a long term strategy for China.