Note: In 2024, Bawang Tea Ji will open flagship stores one after another in bustling business districts such as Raffles City and Great World in Singapore, and the queues will blow up social networks. The first store at Orchard Gateway set a record of receiving more than 10,000 visitors in just three days. As of 2025, its overseas directly operated stores have rapidly expanded to 75. But it wasn't just a sales win. Behind this string of eye-catching data, we are more concerned about its “still waters run deep” capital actions and compliance layout.
Founded in Yunnan, positioned as a "new Chinese style", and successfully listed on NASDAQ on April 17, 2024, every step of Bawang Tea Ji is very organized. In particular, its move to deploy in Singapore provides a standard "Regional Headquarters (RHQ)" template for all Chinese companies that intend to delve deeper into Southeast Asia. The subtlety of this layout is that it goes beyond traditional physical expansion and uses Singapore as a fulcrum to achieve optimization of tax efficiency, liberalization of capital flows, and steady improvement of global brand credit.
1. From store opening to headquarters: What does Bawang Chaji really put in Singapore?
On the surface, Bawangchaji’s “landing on” in Singapore’s core business district is a head-to-head battle for traffic with giants such as Starbucks and Heytea. But from a legal and structural perspective, this is a precise implementation of the "dual headquarters" strategy: the "China local operations center" ensures the product core and supply chain foundation, and the "Singapore regional headquarters" serves as the "key interface" for global capital dispatch. This structural design not only ensures strong brand control over overseas markets, but also uses the Singapore fulcrum to complete a key leap in capital level.
1. Visible expansion: establishing a “brand beacon” in Southeast Asia with 100% directly operated flagship stores
Bawang Tea Ji chose the 100% direct operation model to expand in Singapore. This choice is to ensure brand control and quality consistency to the greatest extent, in order to cope with the risk of franchisees "opening new doors" that frequently occurs in this market.
In markets with unstable legal structures, fast is slow. Therefore, after witnessing the "brand changes" in which Gongcha was rebranded as LiHo and llaollao was replaced by Yolé, Bawang Cha Ji chose to take back the franchise rights and use the most "heavy" direct operation model to build the most "stable" brand moat to ensure that every Singapore store can become the "trust anchor" of its global quality.
2. Invisible layout: not only “opening a store”, but also building the “nerve center” of Southeast Asia
If the long queue at Orchard Gateway is the "face" of Bawang Chaji, then the offshore structure it built on the eve of its IPO is the "underlying support" that supports its valuation and expansion capabilities.
Unlike the excitement of the C-end market, the layout of the B-end market is often sketchy. As early as before listing on Nasdaq in April 2024, Bawangchaji had completed the most critical round of global capital and structural restructuring before the IPO in mid-2023. This is not a simple business registration, but a global capital and operation dual circulation system with Cayman as the top layer and Singapore as the core.
1. Top-level design: the “reservoir” for Cayman’s listed entities
In May 2023, Chagee Holdings Limited was incorporated in the Cayman Islands. As the pinnacle of the entire structure, the purpose of establishing this entity is very clear: to raise capital from international investors and become the legal vehicle (Listing Vehicle) for future Nasdaq listings.
2. Central location: the strategic anchor of Singapore’s “three-tier architecture”
Under the Cayman main body, Bawang Chaji did not penetrate directly into the territory, but carefully set up a three-tier Singapore company structure. Each layer of entities has a strict functional division of labor, which together form the solid base of its Southeast Asia Regional Headquarters (RHQ):
- Holding and investment layer: CHAGEE HOLDINGS PTE. LTD. and CHAGEE INVESTMENT PTE. LTD. were established successively. As the "middle layer" connecting the top level of Cayman and operating entities in China, they assume the key functions of capital channels and tax blocking.
- Operations and Management: On July 11, 2023, CHAGEE GROUP (SEA) PTE. LTD. was officially registered (current status is "Existing") and is defined as the command center for Southeast Asia operations.
3. Functional Reshaping: The Redefined “Singapore Role”
This series of densely populated entities (including the affiliated company CHAGEE SUPPLY CHAIN MANAGEMENT (SEA) PTE.LTD.) actually exposed the true strategic intentions of Bawang Cha Ji - Singapore is by no means a simple retail market, but the "heart" and "brain" of the entire Southeast Asia region.
- As a "regional hub of the supply chain": The physical presence of CHAGEE SUPPLY CHAIN MANAGEMENT (SEA) PTE. LTD. directly confirms its positioning as a "regional trade center". We found in the public registration information of the Singapore Accounting and Corporate Regulatory Authority (ACRA) that the company's core business category (SSIC Code) is defined as "Wholesale trade of a variety of goods without a dominant product". In practice, this code is usually used in a comprehensive trade structure covering "multi-category cross-border procurement, unified settlement and regional distribution", clearly revealing its true function as a procurement and settlement coordination center in Southeast Asia. Bawang Chaji specializes in "original tea + fresh milk" and is highly dependent on the supply chain of China's origin. Through this Singapore supply chain entity, the company is able to centralize procurement and quickly clear customs. It uses Singapore's advantages as a shipping and financial center to reduce costs and balance exchange rates, and then radiates and delivers products to hundreds of stores in surrounding markets such as Malaysia and Thailand.
- As the "master valve for capital dispatch": In the F-1 prospectus, the capital flow path is clearly visible: Cayman (financing end) → Singapore (hub end) → China (operation end) Singapore’s three-tier structure plays the role of a “fund pool”. In 2023 alone, the group provided millions of dollars in shareholder loans through Singapore entities. This not only opens up the channel for overseas financing to flow back to China to support business operations, but also reserves a compliance interface for future global profit collection.
Compiled based on Bawangchaji SEC F-1 prospectus (Prospectus) and Singapore ACRA public registration information
2. Architecture dismantling: Why Singapore? (Capital "conspiracy" before IPO)
Bawangchaji has been listed on Nasdaq in April 2024, and its structural design is bound to withstand the rigorous scrutiny of the SEC (U.S. Securities and Exchange Commission) and the Western investment community. Against this background, Singapore’s structure has long gone beyond a simple “holding platform” and has assumed three key functions in Bawang Cha Ji’s global chess game:
1. The “super connector” in red-chip architecture: lock in control and retain profits
In the Cayman-Singapore-China multi-layered shareholding structure, Singapore is in the most critical "waist" position.
- "Stabilizer" of control: The top-level Cayman entity adopts a dual-class share structure (Dual-Class Share Structure) design, allowing founders to hold Class B shares with 10 times the voting rights, thereby locking in control while introducing US dollar funds. The middle-level Singapore entity (CHAGEE HOLDINGS / INVESTMENT PTE. LTD.) serves as the "execution center" of this control will. It is not only the legal recipient of overseas financing, but also the compliance channel for capital injection into Chinese subsidiaries.
- The "throttle" of tax planning: According to the China-Singapore Double Taxation Agreement (DTA), Singapore resident enterprises that meet substantive operating requirements are expected to reduce the withholding tax rate from 10% to 5% when receiving dividends from subsidiaries in China. For a company with a valuation of tens of billions, this tax difference means a huge profit retention space, which is the tax optimization effect directly reflected in the "cash flow improvement" in the red-chip structure.
2. Strategic anchor: the “springboard of trust” connecting Chinese and American capital
For Chinese companies seeking to list on U.S. stocks, the Singapore structure is a legal "cushion" and "credit enhancement zone."
- Hedging audit risks (HFCAA): In the context of the US Foreign Companies Accountability Act (HFCAA) and PCAOB cross-border audit supervision, the Singaporean structure is not only a physical shell, but also a legal buffer. According to the PCAOB’s official announcement, Singapore is a cooperative jurisdiction that has signed a “Regulatory Cooperation Agreement” (Statement of Protocol) with it. Locating the core holding entity in Singapore enables the company to hire a Singaporean audit institution recognized by the PCAOB as the principal auditor, which helps to substantially reduce the delisting risk caused by audit supervision conflicts under the current regulatory framework.
- The "valuation premium" of the common law system: Singapore follows the common law system (Common Law) that is in line with the United Kingdom and the United States, which greatly reduces the cognitive costs of US stock investors on cross-border regulatory differences and concerns about "emerging market risks". Legal certainty is directly transformed into capital trust and valuation premiums.
3. “Double transfer station” of supply chain and data
In addition to capital and taxation, Singapore is also the overseas hub for Bawang Cha Ji’s entity operations.
- The "settlement center" of the most efficient supply chain: Bawang Chaji emphasizes that "original tea + fresh milk" originates from China. By using Singapore (where the wholesale trade business is registered) as a co-ordination center, the company is able to take advantage of its efficient logistics infrastructure and financial settlement system. Bawang Chaji’s second quarter financial report for 2025 shows that its logistics costs account for less than 1% of GMV, and its inventory turnover period is as low as 5.3 days. The Singapore headquarters plays a central role here: it not only reduces costs through centralized procurement, but also smoothes exchange rate risks through offshore settlement.
- The “firewall” of data compliance: In the era of digitalization going overseas, Singapore serves as a key data compliance hub. Taking advantage of the natural connection between Singapore’s Personal Data Protection Act (PDPA) and China’s Personal Information Protection Law (PIPL) in terms of compliance standards, Bawangchaji adopted a secondary springboard model of “China→Singapore→Southeast Asia”. By performing a professional Transfer Limitation Assessment in Singapore, the company has not only established a set of standardized compliance benchmarks that radiate to markets such as Malaysia and Thailand, but has also effectively avoided the "minefield" of legal conflicts that may arise in direct cross-border transfers from China.
3. Risk Enlightenment: Singapore’s “Four Invisible Thresholds” for Going Overseas
The success of Overlord Cha Ji can easily give people the illusion that "I can do it too." But for most small and medium-sized enterprises that follow the trend of going overseas, the real challenges often start with "compliance costs" and "organizational implementation." When personnel compliance has not been resolved, a chain reaction of data, brand and system risks often follows. If you are not careful, these invisible thresholds may become "dissuasion orders" for enterprises.
1. "Misjudgment" of hidden costs: Registration is just the beginning, maintenance is the bulk.
Many companies are attracted by Singapore's "convenient registration and low tax rate" label, but ignore the hidden costs of compliance maintenance.
- Difficulty opening a bank account: In the context of global anti-money laundering (AML) tightening, Singaporean banks have extremely strict KYC (Know Your Customer) reviews for Chinese-funded companies. Without proof of substantial business or endorsement from affiliated companies, the account opening process may take several months, or even be directly rejected, resulting in the inability to land funds.
- High compliance costs: According to Singapore's Companies Law, companies must hire a licensed company secretary (Company Secretary) and appoint at least one local director (Local Director). If a company fails to convene a general meeting of shareholders (AGM) or submit an annual report (Annual Return) on time, directors will face the risk of being fined or even appearing in court.
Risk Warning Do not apply the domestic thinking of "finding an accounting agency to get it done for a few hundred dollars" to Singapore. Every compliance declaration and risk guarantee of every nominal director here are clearly priced "hard costs".
2. The “hard nut” of labor compliance: you can send whoever you want.
Although Singapore has a good business environment, the restrictions on foreign workers are not only due to "high costs" but also "strict quotas". Singapore's Ministry of Manpower (MOM) implements a strict quota system (Quota) and evaluates Employment Pass (EP) and Pass (SP) applications through the COMPASS framework. If a company does not have a sufficient local employee base (Local Workforce) in Singapore, it will simply not be able to obtain sufficient foreign employee quotas.
Risk Warning This is not only a cost issue, but also a legal red line. If you do not plan the talent structure in advance and blindly promise to dispatch domestic core teams, you will most likely end up getting stuck in the MOM approval process, leading to the embarrassing situation of "the company is up and running, but people can't get through".
3. The “two-way valve” for cross-border data: cracking the regulatory overlap between PIPL and PDPA
For any overseas enterprise with digital business (whether it is cross-border e-commerce or SaaS platform), data compliance has changed from an "optional" to a "must answer" in the global market. Any cross-border flow involving user information faces a tricky "regulatory overlay" situation: it must not only meet the strict export requirements of China's Personal Information Protection Law (PIPL), but also meet the acceptance standards of Singapore's Personal Data Protection Act (PDPA). By ignoring this, companies will be directly exposed to the cross-fire range of law enforcement agencies in both countries.
Bawang Cha Ji’s strategy is to establish a “compliance buffer zone” in Singapore. Taking advantage of the compatibility of Singapore's legal system, a professional "Transfer Limitation Assessment" (Transfer Limitation Assessment) is carried out here to establish Singapore as the "first destination" for data going overseas. This not only resolves direct cross-border legal conflicts, but also provides a set of reusable standardized compliance templates when later radiating to other Southeast Asian markets, transforming uncertain legal risks into controllable compliance processes.
4. The "war for registration" of intellectual property rights: before the troops are moved, trademarks must go first
Southeast Asia is the hardest hit area for trademark squatting, and what is more dangerous than "external squatting" is "channel backstabbing" from within. There has been a famous "franchisee flop" incident in the Singapore market (such as Gongcha changing to LiHo, llaollao changing to Yolé), causing the brand to lose all offline stores overnight. The underlying logic of Bawangchaji’s choice of a 100% direct operation model is precisely to eliminate the risk of agents “setting up a separate business” and to build a moat for operational security through absolute control over stores and leases.
For most companies that still need to adopt a franchise or license model to go overseas, "register first, enter later" is an iron rule. Confirming trademark rights in various countries before entering the market is the only way to lock the brand in a safe, and it is also the only legal trump card to fight against "insiders" and "treason" when disputes arise.
4. Conclusion: Architecture first, no regrets when making a move
Bawangcha Ji’s overseas overseas sample tells us: An enterprise’s overseas expansion is by no means a simple physical displacement of its products, but a global extension of its legal structure and compliance system.
Looking at the essence through the phenomenon, the core of its internationalization strategy is capital-driven. Whether it’s the crowds queuing up at Orchard Gateway or the Nasdaq’s bell-ringing moment, its success is inseparable from a clear top-level design and the strong support of institutional shareholders (such as XVC, Fosun, etc.).
For all overseas companies that are waiting to see or have already started, perhaps the biggest inspiration is:
“True internationalization is not to wait until the company is about to go public and then think of finding a lawyer to set up a structure, but to have already thought about the capital path for the next five years before opening the first overseas store.” As we often say in practice: Architecture design is the first chess piece for a company to go overseas. A good structure is externally a "firewall" to isolate legal risks (such as using a private limited company to cut off joint and several liability), and internally it is an "accelerator" to improve capital efficiency (such as using DTA to optimize tax costs).
How well this chess piece is placed often determines whether the company is "short-lived" or can "go long-term."
This article is general information and not legal advice. Specific matters require assessment by appropriately qualified professionals.