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Chinese law requires that a company first acquire a lease for office space before it can receive a business license.
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The world’s largest social network is trying to break into the world’s largest marketplace. Facebook has announced plans to open an office in Beijing, China, land of the largest number of internet users in the world.
Chinese law requires that a company first acquire a lease for office space before it can receive a business license.
Facebook reportedly signed a three-year lease in May for more than 8, 600 square feet of office space in the Fortune Financial Center in Beijing’s central business district. The district is an enclosed free trade zone, where the firm will be limited to a small area with a population of only 5 million. The offices are located in the top third of a 61-story, 880 foot tall building on the Third Ring Road to the east of Beijing’s Forbidden City
Bloomberg has reported that not all of the available floor space on the floors taken by Facebook in the tower is occupied, as the building’s owners likely expect the company to expand its lease in the near future.
The move comes in spite of the fact that China has blocked its Internet providers from offering access to Facebook since 2009.
Facebook hopes to increase sales in Asia, where it brought in $354 million, or 14 percent of revenue, in the first quarter of 2014. That’s a 200% increase from the $118 million, 11 percent of total revenue, when the company first launched its IPO in May 2012.
Facebook already has an office in Hong Kong, selling advertising to Chinese businesses looking to reach potential customers around the world. Facebook Vice President Vaughan Smith told the Global Mobile Internet Conference in Beijing in May that they also employ thousands of programmers in China.
Facebook spokeswoman Debbie Frost told Bloomberg, “Chinese exporters and developers are finding Facebook is an excellent way for them to reach customers outside China. Today, our sales team in Hong Kong is supporting these Chinese businesses. We are of course exploring ways that we can provide even more support in the future.”
In the company’s prospectus for its 2012 initial public offering, Facebook declared that it was prevented from entering the Chinese market due to “substantial legal and regulatory complexities.”
