The two companies already have a relationship with each other but the new joint venture will license and provide technical support for Microsoft Windows 10.
Microsoft has had some local difficulties in China with its operating systems and CETC will give the Seattle company a boost to penetrate the market with legal copies of its operating system.
CETC will supply Windows 10 in a local version not only to businesses and to individuals, but also for military use.
According to Yusuf Mehdi, a senior Microsoft executive, the joint venture needs regulatory support.
Called C&M Information Technologies, the outfit will collect feedback from government customers to guide it in updates to government Window 10 image.