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Review and due diligence for China investments and acquisitions
Invest in China with confidence through rigorous financial and operational due diligence. Our review process uncovers hidden risks, validates financials, and delivers the clarity you need before any acquisition, partnership, or major commitment.
Compliance, Transparency, Avoidance of being defrauded and clear communication are the key issues that every foreign company invested in China faces. We provide all the necessary tools and mechanisms to the foreign investors abroad to maintain full control over their Chinese entity and obtain clear and transparent data and information regarding the business of their subsidiary.
The main tools we offer our clients to achieve transparency and control in China are as follows:
Company Review in China
A large number of foreign companies operating in China have reviews done by professional and licensed tax advisors. These reviews are generally done on a recurring basis, monthly, quarterly, bi-annually, or annually.
Why Do a Company Review in China?
The aim of this support is to have a team of professionals involved in the local accountants’ work, act as a support function for questions and help the management controllers of the headquarter in clarifying sensitive and complex issues and create transparency. The added value here is to have ongoing compliance and clarity in local finances and taxation rather than only relying on the annual statutory audit at the end of the fiscal year which oftentimes is executed by local audit firms with little understanding of international reporting- and compliance requirements.
Focus areas of a Company Review
Focus areas for review services are industry-specific, depend on the requirements of the headquarter abroad and can be jointly defined and specified. In our review function, MSA supports in reviewing the subsidiaries´ recurring accounting, tax declarations and tax issues, payroll, import and export procedures, intercompany transactions, outgoing bank transactions etc. The main goal is to strengthen compliance and increase transparency and efficiency.
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China Due Diligence
Fraud in China can take many forms and can occur in any type of business transaction, perpetrators can be internal- or external actors, commercial companies, or 3rd party agents. Preparation and prevention are the key to success for foreign companies engaging in doing business in China. Proper due diligence allows investors to understand the nature of the transaction or deal, the all the risks involved, and whether the deal is suitable for the company. Proper preparation and prevention are the key to success for foreign companies engaging in doing business in China
Foreign entities rely on professional financial advisors to navigate the large numbers of databases, often not accessible to the general public and where information is available exclusively in Chinese.
When Should Foreign Business in China Carry Out Due Diligence?
Cooperating on manufacturing with a Chinese partner, for producing goods or parts
Cooperating on distribution with a Chinese partner of products or parts
Licensing trademarks to a Chinese partner
Reference checks and 3rd party legitimization of:
Key personnel
Suppliers
Key clients
Licensees
Competitors
On-Site visits and inspections
Corporate Social Credit System
As the Chinese Corporate Social Credit System will make the enforcement of laws and regulations stricter and more systematic, it is important for companies to be fully up to date about how the social credit rating can impact your business.
Even though the requirements which companies must meet are well-defined in existing and new regulations, a challenge arises because there is currently no centralized database which provides a clear overview of these requirements. This means that knowing all requirements relevant for your company can be a time consuming and costly task. As a leading tax and financial advisory company in China, we specialize in helping Foreign Invested Enterprises be compliant with Chinese laws and regulations.
Our China Corporate Social Credit Services include:
Company Public Credit Profile Review – Because a company’s social credit rating will be affected by the rating of business partners, we would as well examine the social credit rating of your business partners, suppliers, clients etc. to identify potential threats you’re the credit rating of your Chinese subsidiary.
Company Financial Review – We are specialized to conduct a review of a Chinese subsidiary’s accounting and internal financial processes to identify potential hazards and compliance issues which directly affect your social credit score
Credit Restoration Services – Upon discovery of low social credit scores or blacklisting, our team helps to rectify outstanding compliance issues and supports to apply for credit restoration with relevant authorities.
To learn more about our services or understand more about how it works, get in touch with us right away and we can give you all the information you need.
Frequently Asked Questions
Considering a Chinese target, partner or supplier? Below are the most common due diligence questions we are asked by foreign investors.
What types of due diligence are essential in China?
The core stack is financial DD, tax DD, legal DD, HR DD, commercial / operational DD and compliance / background DD. For many deals IT and ESG reviews are added. Because Chinese regulatory and tax exposure can escalate quickly, tax and related-party transaction DD should never be skipped.
How do you verify a Chinese company's basic information?
We start from the National Enterprise Credit Information Publicity System, cross-checking business licence, shareholders, registered capital, legal representative, scope of business and administrative penalties. We then extend into court records, IP filings, tax credit rating and banned-entity lists.
Can you detect off-balance-sheet liabilities or undisclosed related-party deals?
Structured financial and tax DD typically uncovers related-party transactions, guarantees, undeclared loans, inter-company invoicing and VAT inconsistencies. Combined with a site visit and management interviews, this gives a realistic view of the target's real economic position — not just the audited accounts.
What is the Corporate Social Credit System and why does it matter?
China's Corporate Social Credit System rates companies on tax, customs, environmental, labour and other compliance. A low score can restrict bidding for public contracts, obtaining bank loans and cross-border payments. Checking a target's credit status is now part of every serious DD.
How long does a due diligence project take?
A focused financial and tax DD takes 2 to 4 weeks once data access is granted. A full DD package (legal, financial, tax, HR, commercial) usually runs 4 to 8 weeks. MSA phases the work so that red flags are surfaced early, before significant deal spend.
Can MSA do due diligence outside of mainland China?
Yes. Through MSA Asia's regional team, we cover mainland China, Hong Kong, Singapore, Vietnam, Japan, Korea, Malaysia, Indonesia, Thailand and Taiwan — ensuring consistent due diligence methodology across your Asian investment footprint.
MSA is one of the most customer friendly incorporation firms in China. They took the time to understand our business and key objectives, then tailored the whole incorporation process accordingly.
VU
Verified User
Verified on G2
5/5
EOR & HR
Can Highly Recommend MSA!
MSA has been outstanding in providing comprehensive EOR services. Their team is incredibly knowledgeable about local employment laws and regulations, ensuring full compliance at all times.
RH
Rick H.
Verified on G2
5/5
Incorporation
Positive Experiences with MSA Throughout Whole Process
MSA was great to work with during the process of setting up our representative office in Shanghai. They were always responsive, clearly explained all required steps, and kept us on schedule.
JD
Jim D.
Verified on G2
5/5
Incorporation
Excellent Service for Company Incorporation and Compliance
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LN
Lisa N.
Verified on G2
5/5
Tax & Accounting
Help with Tax Matters in Malaysia
MSA's tax advisory team helped us navigate a complex cross-border tax situation between China and Malaysia. Their advice was practical and always tailored to our specific business structure.
VU
Katherine B.
Verified on G2
5/5
Tax & Accounting
Excellent Experience with MSA, 100% Recommended
From the very first consultation, MSA demonstrated deep expertise in Asia business services. They helped us restructure our regional operations for better tax efficiency.
VU
Jeanne Y.
Verified on G2
4.5/5
Advisory
Global Standards, China Know-How
We were looking for a partner that understood both international standards and local Chinese business practices. MSA turned out to be exactly that kind of partner.
TG
Tom G.
Verified on G2
5/5
EOR & HR
Entering HK and China First via EOR Then Setting Up Our Subsidiary
MSA helped us enter the Chinese and Hong Kong markets quickly through their EOR service, while simultaneously handling the full subsidiary setup process.
SS
Sinan S.
Verified on G2
5/5
EOR & HR
Our Experience with EOR Services Switching to MSA
Switching our EOR services to MSA was one of the best decisions we made. The transition was seamless, and we saw immediate improvements in both service quality and cost efficiency.
VU
Dennis K.
Verified on G2
5/5
Tax & Accounting
MSA Promised and Delivered Effortless Transition
When we decided to switch our accounting and compliance services to MSA, we were nervous about the transition. MSA made it completely stress-free with a clear migration plan.
VC
Victoria C.
Verified on G2
5/5
EOR & HR
We Did Payroll Optimization with MSA, Worked Like a Charm
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CY
Chris Y.
Verified on G2
5/5
Tax & Accounting
Tax Declaration and Accounting Support, + IFRS Reporting
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VU
Verified User
Verified on G2
5/5
EOR & HR
MSA Onboarded Our Team via PEO: Can Recommend Absolutely!
We needed to quickly onboard a team of 5 engineers in China without having a local entity. MSA's PEO solution was perfect — fully compliant and operational within 2 weeks.
VU
Verified User
Verified on G2
5/5
Tax & Accounting
Our Go-To Partner for Solving Tax and Cashflow Issues
MSA has been our go-to partner whenever we face tax or cashflow challenges in China. Their proactive approach means they often identify issues before they become problems.
VU
Verified User
Verified on G2
4.5/5
Advisory
Dedicated Service Solving Issues
What stands out about MSA is their dedicated approach to problem-solving. When we had a complex visa issue for one of our employees, they worked tirelessly until it was resolved.
VU
Verified User
Verified on G2
5/5
Tax & Accounting
Tax Optimisation in China
MSA's tax optimization strategies saved our company a significant amount in our China operations. Their team identified several tax incentives we were eligible for but hadn't been claiming.
WH
Wilson H.
Verified on G2
4.5/5
Tax & Accounting
Cost Savings Through Accounting- and Tax Restructuring
We engaged MSA to review our accounting and tax structure in China. Their recommendations led to substantial cost savings while keeping us fully compliant with local regulations.
ES
Edouardo S.
Verified on G2
5/5
Incorporation
Nanjing Company Incorporation
Setting up our company in Nanjing was made straightforward by MSA. They handled all the local government interactions, documentation, and registration processes efficiently.
VU
Verified User
Verified on G2
4.5/5
Tax & Accounting
We Liquidated One of Our Subsidiaries in China with MSA
Liquidating a Chinese subsidiary is notoriously complex. MSA managed the entire process professionally, handling tax clearances, employee settlements, and deregistration.
VU
Verified User
Verified on G2
5/5
Incorporation
Excellent Help with Setting Up WFOE in Shanghai
MSA provided excellent support throughout our WFOE setup in Shanghai. They were transparent about timelines, costs, and requirements from the very beginning.
VU
Verified User
Verified on G2
5/5
Incorporation
Establishment of Our RO with Guidance of MSA
We wanted to explore the Chinese market but were not ready to set up a full company. MSA guided us in making the right choice based on our company's activities and goals.
VU
Verified User
Verified on G2
5/5
Incorporation
MSA Went Far and Beyond During Our WFOE Set-Up in China
Interest, response time, diverse cultural backgrounds, and assistance in different languages made our WFOE setup experience exceptional.
VU
Verified User
Verified on G2
5/5
Tax & Accounting
MSA Set Up Our WFOE in Shanghai and Works from Our Accounting System
Clear advice and instructions during the setup. And the ability to work in our accounting environment, so we can easily consolidate the financials at headquarters level.
VU
Verified User
Verified on G2
5/5
Incorporation
MSA Helped Setting Up Our Subsidiary in China
We saw business opportunities in China and were debating whether to set up a company. Due to the excellent guidance of MSA we were able to successfully establish our subsidiary.
VU
Verified User
Verified on G2
5/5
Tax & Accounting
Our Go-To for China Tax Issues and Support
Responsive and proactive team that listens to our issues and comes with practical and quick solutions.
VU
Verified User
Verified on G2
5/5
Incorporation
Great Support Setting Up WFOE in Beijing
Ability to speak Dutch, clear and fast communication, and guidance and advice along the way made the process smooth.
VU
Verified User
Verified on G2
5/5
Advisory
Great Backoffice Support
They require very little input from our side, but if we need some clarifications, they are quick to respond.
VU
Verified User
Verified on G2
5/5
Advisory
Fast and Easy Entry to China
Communication was very fast and easy, services clearly communicated. MSA made our market entry straightforward.
VU
Verified User
Verified on G2
5/5
Incorporation
Starting Our JV in China with the Support of MSA
Knowledge, responsiveness, and cultural understanding made MSA an invaluable partner for our joint venture setup.
VU
Verified User
Verified on G2
5/5
Advisory
Great Partner to Complement Our Own Service Portfolio
They add value to our customers while respecting that we are the primary contact for them.
VU
Verified User
Verified on G2
5/5
Incorporation
Great Assistance During Company Incorporation in China!
Professional expertise and English proficiency made the entire incorporation process smooth and efficient.
VU
Verified User
Verified on G2
5/5
Advisory
Great Support in China
They cover also smaller cities in China, providing excellent support regardless of location.
VU
Verified User
Verified on G2
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