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Open a Hotel in China

Open a Hotel in China

Domestic and foreign tourists contribute to hotel developments in China. Over the last years, the local tourism market has grown by 10%, enhancing the expansion of the hotel industry in China. Tourism in China is an important industry in the government’s five-year plan and contributes to China’s GDP by 4.5% each year. Given these economic conditions, opening a hotel in China can turn into a very profitable business. The legal aspects regarding the process of setting up a hotel in this country can be explained to you by our lawyers in China.

How to open a hotel in China

If you want to capture a portion of the rapidly growing tourism market and set up a hotel in China, there are a few details to have in mind. Hotels operated through a private enterprise are the most numerous in China. Foreign investments by multinational hotel groups are done through joint ventures and cooperative enterprises. The ownership model in the Chinese hotel market is represented by private enterprises, limited liability corporations and state-owned enterprises. The basic steps to be followed in order to open a hotel in China are:

•    Picking a location – big cities and tourist attractions are the places to look for. You will have to purchase a property in China if you want to build a hotel;
•    Choosing a legal entity – there are several types of companies to choose from, but the most common foreign businesses are joint ventures, representative offices and wholly foreign owned enterprises;
•  Preparing the necessary documents and registering your business in China – articles of incorporation, business licenses, bank letter attesting the opening of a bank account;
•    Hiring employees and starting the business.

Our attorneys in China can give you further details regarding the business legislation and can help you register and manage a hotel in this country.

Hotel industry in China

The hotel industry in China has recently witnessed huge growth, resulting in a 44 billion dollar business and 2.5 million hotel rooms. The fastest-growing middle class in the world accounts for this economic transformation of the hotel industry in China. Brand and chain management concepts and high service standards have been introduced in the hotel sector by foreign businesses.

Provincial authorities plan to promote tourism by encouraging direct investments in this industry and in tourism real estate. These plans include internalization, high-end brands and big impact on the tourism market. You can contact our law firm in China for more information about the legislation for foreign investments in the hotel sector.