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Please use this identifier to cite or link to this item: http://hdl.handle.net/1783.1/902
Title: Entering China : an unconventional approach
Authors: Vanhonacker, Wilfried R.
Keywords: Equity joint ventures
Wholly foreign-owned enterprises
Entry mode
China
Johnson and Johnson
Jahwa Corp.
Issue Date: Dec-1996
Series/Report no.: Marketing Working Paper Series ; MKTG 96.086
Abstract: While EJVs are still necessary in some regulated sectors, and foreign investment is prohibited in still others, there is a growing trend toward a new and possibly much more effective way of doing business in China -- as a WFOE, that is, a wholly foreign-owned enterprise. For all intents and purposes, EJVs and WFOEs are substantially the same in terms of taxation and corporate liability. They also operate under similar foreign exchange rules and comparable import and export regulations for licensing, quotas, and duties. In fact, their only real differences are that WFOEs take less time to establish than EJVs, are not technically required to have a board of directors, and are currently prohibited in some sectors in which EJVs are approved. This paper investigates in some depth the question of whether WFOEs are a realistic alternative to EJVs, using the examples of Johnson and Johnson, and Shanghai Jahwa Corp.
URI: http://hdl.handle.net/1783.1/902
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