Last Updated on June 12, 2025
Even if you’re planning to enter the local market virtually, it’s a no-brainer that you need to present a business license or some kind of permit to sell anything to Chinese consumers.
The real question is what kind of licenses do you need, and how can you obtain them?
Read along as we discuss the types of business licenses you’ll need to sell online and operate legally in China’s digital ecosystem.
Can You Open an Online Business in China as a Foreign Brand?
Yes, a foreign brand can open an online business in China. However, the process varies depending on your brand goals and the scope of your operations.
Listed below are the three methods you can consider for online business operations in China:
• Cross-border E-commerce Platforms
Foreign companies operating online can choose to launch their products and services via Chinese cross-border e-commerce platforms like JD, Tmall, Kaola, WeChat, Douyin, and Xiaohongshu.
These platforms allow non-Chinese companies to sell goods to their user base without establishing a local business entity. These foreign businesses only need to present their existing legal permits, registrations, and other platform-specific requirements.
The platform handles customs clearance for international trade under the CBEC system. However, you must still provide Chinese-language documents related to your business information and work with a local logistics agent.
• Wholly Foreign-Owned Enterprise (WFOE)
A WFOE is a Chinese limited liability company owned 100% by foreign investors. By setting up this business entity, you become a local company with a Chinese business license, Chinese bank accounts, and the legal right to sell directly in China.
This allows you to import goods under your official company name, operate a Chinese website (with ICP license), and sell on domestic platforms.
However, establishing a limited liability company to conduct business in China is rarely suitable for small- to medium-sized foreign enterprises with limited financial capability and resources.
It requires considerable time and resources, as it involves registering the company (getting a business license), possibly depositing capital, and maintaining local compliance.
• Local Distributor or Licensing Partner
A local firm would import, store, and sell your products under its own licenses while you provide the merchandise. This would leverage the partner’s logistics and market knowledge.
This partner will also stand as your business and legal representative as your company conducts commercial activities in the local market.
For example, Chinese distributors and daigou often handle importing, storing, and shipping for you, giving you time to build demand. The trade-off is sharing profit, but it can be another low-risk way to test the Chinese market besides cross-border e-commerce.
What licenses do you need to sell online in China?
Commercial ICP License
An Internet Content Provider (ICP) License is an official document mandated by China’s Ministry of Industry and Information Technology (MIIT).
Regardless of business scope or structure, this is mandatory if you intend to conduct online financial transactions with Chinese consumers.
The commercial ICP license is not to be confused with the ICP Filing, as the latter is required for any brand, under any business category, launching websites for informational purposes only.
Source: AppInChina
Chinese Business License
This is your brand’s official company registration certificate in China, showing its legal trade name, address, and business scope.
You need a local business license in China to establish a WFOE or launch an official stand-alone online shop (not through CBEC). The verification process of obtaining this permit can be lengthy, especially for foreign investors.
However, it’s not required for pure cross-border e-commerce business activities. Non-Chinese companies can operate through their foreign registration since the platforms accept overseas credentials.
China Compulsory Certification (CCC)
This is a mandatory safety and quality regulation for many products sold in the Chinese market. It covers 94 specific items, including wires and cables, switches, household appliances, power tools, lighting, automotive parts, machinery, children’s products, and more.
If your product falls under any CCC category, it must be certified before sale in China. Most ordinary consumer goods (like clothing or toys) are not CCC-mandated, but any covered electrical or industrial product requires it.
Source: Trades Nest
Industry-Specific Business License
It’s worth noting that certain regulated goods need extra approval or registration. For example, financial institutions and medical-related brands must present their specialized permits to prove they’re authorized and qualified to provide their offerings to Chinese consumers.
This also applies to a consulting company if part of their business scope includes providing professional advice that requires specific qualifications.
Even imported food products (including dairy, infant formula, and supplements) usually require registration with China’s food safety authority and a Chinese label.
If your products fall into other restricted categories (e.g., alcohol over quotas, tobacco, weapons, certain chemicals, adult products), they may be prohibited by government authorities or require a special business license. Always verify current Chinese laws for those industries.
Platform-Specific Licensing Requirements
So, if you choose the cross-border e-commerce route, do you need a business license to sell in China? Generally, you might think not, but it’s worth noting that each platform has its own checklist when implementing local regulatory compliance mandated by the Chinese government.
For example, Douyin has a thorough verification process before you can conduct business transactions within its interface. To access some of its commerce-centric features, brands must provide their business license (or equivalent) and a Chinese phone number.
Meanwhile, Xiaohongshu requires a Chinese business license number to open an e-commerce store. Tmall Global and JD Worldwide require your foreign company registration, brand authorization, and product credentials, but not a Chinese entity.
And when opening WeChat stores, businesses are prompted to link their Chinese ICP license. Always check each platform’s merchant guide for the exact documents needed.
Why Do You Need a Business License to Sell in China?
Being properly licensed and legally registered in China brings several advantages:
• Legal authorization & platform access
Having the required business license means you can officially operate and register on major platforms. As you know, online payment providers and marketplaces typically only onboard sellers with legal registration.
Without an ICP license, you simply cannot legally host a site or app in China. It ensures you appear as a legitimate merchant, enabling access to all Chinese e-commerce channels.
• Avoiding censorship and shutdown
Sites or online stores without a valid ICP license can be immediately blocked or taken down by relevant authorities. Every website must display its ICP number on the homepage. Otherwise, they can shut it down.
Our client Rioja Wine’s website with its ICP License Number
• Smoother logistics and customs
Complying with the rules can speed up imports. Under China’s CBEC policy, qualified e-commerce goods often get duty/VAT incentives and faster customs clearance. For example, the local authorities offer tariff and VAT subsidies for listed CBEC products.
Operating through a licensed, bonded program or pilot zone gives you access to bonded warehousing. In short, a legal setup often means fewer delays and lower import taxes.
What Products and Services Are You Allowed to Sell in Mainland China?
China strictly regulates what can be sold to local consumers. Two main lists govern this: the CBEC Positive List and the prohibited items.
The official catalog of goods approved for retail import via e-commerce covers thousands of in-demand products. This includes cosmetics, nutritional supplements, baby and maternal products, electronics, clothing, home appliances, and foods.
The latest version (2022) of the positive list includes 1,476 items. Essentially, if your product is on this list, it can be sold through Chinese cross-border channels.
China also maintains a list of goods banned from retail import. This covers about 75 categories of illegal or sensitive items, such as firearms, illicit drugs, endangered animal products, pornographic materials, and certain chemicals. Products on this list cannot be imported or sold to Chinese customers via e-commerce.
Medical device exhibit at China International Import Expo in Shanghai (Source: China Daily)
If an item is not on the CBEC list but is otherwise legal, it can still be sold in China through normal import channels. This requires a Chinese importer (like your WFOE) and the usual import permits and inspections.
Heavy machinery, medical devices, and controlled food products are handled this way because they cannot use the simplified CBEC procedure and must clear customs under standard rules.
Quick Q&A
Do you need to establish a local business entity to sell online in China?
Not necessarily. Under China’s cross-border e-commerce regulations, foreign companies can sell to Chinese consumers without a local company presence or a domestic license. Platforms like Tmall Global, JD Worldwide, and Douyin allow overseas merchants to list products using only their home-country registration.
Can you sell directly on your Chinese-localized website?
To sell directly on your Chinese-localized website, you must acquire a commercial ICP license and register your site with China’s Ministry of Industry and Information Technology (MIIT). If your business scope involves video streaming, online games, or other media, you should also consider obtaining a Network Culture Business License.
Your Trusted Digital Marketing Partner in the Chinese Market!
China’s e-commerce market is vast and lucrative, but it demands careful compliance. You can sell through major cross-border platforms without a local entity (simplifying compliance) or choose another route. Each approach has pros and cons, so pick the one that fits your long-term goals and strategy.
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At Sekkei Digital Group, we have an in-depth understanding of China’s ever-changing digital landscape. With our first-hand industry experience and extensive expertise, our team is ready to assist your brand to reach new heights in the Chinese market.
Whether you intend to launch an e-commerce store or implement an advertising campaign on specific platforms, we have all the digital solutions you need! Contact us today, and let’s start your market entry strategy in China.
