Setting Up in Pakistan as a Chinese Company: What Changes for a Chinese Parent

A Chinese company entering Pakistan follows the same Pakistani process as any other foreign company: permission from the Board of Investment (BOI) for a branch or liaison office, or incorporation of a local company with the Securities and Exchange Commission of Pakistan (SECP). What differs for a Chinese parent is the work that happens in China before and alongside that process, the treaty position on money coming back, and the trade and zone arrangements between the two countries. This guide covers those points and refers to our other guides for the Pakistani steps.

The Pakistani route is the same

A branch office suits a company performing a specific contract in Pakistan, a liaison office suits one that only promotes its products, and a locally incorporated company suits a business that will sell, invoice or employ people in Pakistan on an ongoing basis. Neither a branch nor a liaison office may trade. The BOI fee, documents, timeline and SECP filings are set out in our guide to opening a branch or liaison office, and the steps for a local company in our guide to registering a company as a foreign investor. The BOI states that foreign equity has no upper limit except in specified sectors (BOI, FAQs). Companies with foreign directors or shareholders are also subject to a Ministry of Interior security clearance, and the SECP incorporates them on an undertaking that directors will be replaced if clearance is refused (SECP press release, 12 March 2013).

What happens on the Chinese side

A Chinese investor putting capital into an overseas entity generally has to deal with three Chinese authorities. Reports from law firms describe a three-track framework: the National Development and Reform Commission (NDRC) handles project-level approval or filing, the Ministry of Commerce (MOFCOM) handles approval, filing and reporting for the overseas enterprise, and the State Administration of Foreign Exchange (SAFE) handles foreign exchange registration and the transfer of funds. Transactions above certain thresholds, or in sensitive countries or sectors, need approval rather than a filing, and funds can only leave China once the foreign exchange registration is complete. A new State-level outbound investment regulation was reported to take effect on 1 July 2026, with the ministerial rules and the SAFE regime continuing to apply (Charles Russell Speechlys, 2026; China Briefing). Thresholds and procedures change, so a Chinese parent should confirm its own requirements with Chinese counsel before committing funds. We do not advise on Chinese law.

These procedures take time, and the Pakistani application usually needs documents the Chinese parent already holds, so it helps to run the two tracks in parallel.

Documents and language

The parent company’s registration certificate and constitutional documents are the core of a BOI and SECP application. The SECP requires core corporate documents to be certified in the country of origin and authenticated by a Pakistani diplomatic or consular officer, or apostilled where that route applies, and documents not in English need certified translations. China and Pakistan have both joined the Apostille Convention, but whether Pakistani authorities currently accept an apostille on Chinese documents, or still require embassy authentication, should be confirmed with the BOI and the SECP before documents are prepared. Choosing the wrong route is a common cause of delay.

The tax treaty: money coming back to China

Pakistan and China have a double taxation agreement, signed on 15 November 1989. The Federal Board of Revenue’s treaty table lists the following rates (FBR, treaty rates).

Where a treaty rate is higher than the domestic rate, the payer may apply the domestic rate, so the lower of the two can apply; see our guide to taxes for foreign companies. Remitting profits and dividends goes through an authorised dealer bank and requires the original investment to have been registered correctly, as explained in our guide to repatriating profits. In July to September 2026, the State Bank of Pakistan reports USD 315.1 million in profit and dividend payments on direct investment to China, the largest of any country, which shows that the route is in regular use.

Trade and zones

The second phase of the China-Pakistan Free Trade Agreement entered into force on 1 December 2019 and phases in tariff cuts, increasing the share of tariff lines with zero tariff from 35 percent towards 75 percent over a period of years (China Briefing). Whether a given product benefits depends on its tariff line, and the preferential rate has to be claimed with the right origin documentation; see our guide to the 2026-27 customs tariff for how duties are worked out. A company that wants to manufacture in Pakistan can also look at special economic zones, whose incentives and phase-out are described in our zones guide.

Practical checks before you start

1. Confirm the investment route in China with your Chinese advisers and start those procedures early.
2. Decide between a branch, a liaison office and a local company based on whether you will trade in Pakistan.
3. Ask the BOI and the SECP which authentication route they accept for Chinese documents.
4. Appoint a resident authorised person in Pakistan, which the SECP requires for a foreign company.
5. Register the investment with an authorised dealer bank from the start so that dividends can be remitted later.
6. Check the sector for foreign-equity limits and licences.

This guide is an orientation based on official and published sources, not legal or tax advice. Requirements change, and specific steps should be confirmed with qualified advisers in China and in Pakistan.

How PIVRA can help

PIVRA can prepare step-by-step registration and licensing guidance for your structure and sector, compare your entry options in a market entry roadmap, and check the background of a local partner or distributor, working alongside your lawyers and accountants. Request a quote.

Sources

• Board of Investment, FAQs and Branch/Liaison Office pages
• SECP, Foreign Company FAQs; press release of 12 March 2013
• Federal Board of Revenue, Tax Rates: Dividends, Interest, Royalty, Fee for Technical Services under Double Taxation Agreements
• State Bank of Pakistan, Repatriation of Profit / Dividend by Country on Foreign Investment, September 2026
• Charles Russell Speechlys, China’s new outbound investment regulation (2026)
• China Briefing, China-Pakistan FTA Phase II