We hear so many half-truths and misconceptions about registered capital that it’s hard to keep track of them all, let alone dispel them. Not for lack of trying, though: see e.g. China Company Law Myths: Registered Capital and Personal Liability and China WFOE Minimum Capital Requirements: The Goldilocks Rule. Without further ado, following please find
Foreign companies doing business in China must onboard their employee hires correctly. Unfortunately, there are many myths that make doing this less likely. This post briefly explains four common and potentially dangerous China hiring myths. 1. Hiring Without a Chinese Legal Entity (WFOE or Joint Venture) is Fine if You Bring on Only Independent Contractors.
Dual Language China Contracts: What You Must Know I cannot believe this is still happening, but it is. The “this” to which I am referring is foreign companies signing dual language contracts without knowing exactly what the Chinese language portion of their contract says. This is dangerous for the reasons given below. The Pitfalls of Dual
Chinese manufacturers are notorious for making and sending bad products. Not surprisingly, foreign buyers of these bad products often refuse to pay their Chinese factory anything more for those products. This unpaid amount is often substantial. The foreign buyer then moves on to a new factory. This new factory is often located in the same
If you are an expat working or seeking a job in China, your China employment contract matters. If you plan to travel to China to take a new job there (or even just take a new job there) you should do all of the following Have your proposed employment contract checked by a China employment
Not a month goes by without a company telling me how great their relationship is with their Chinese counterparty, be it the Chinese company with which they are contemplating a joint venture or the Chinese company that manufactures their widgets. As a lawyer, my thoughts when hearing this sort of thing tends to be as
The basic rule for foreign companies hiring an employee in China is that you cannot do so unless and until you have a Chinese legal entity (e.g., a WFOE), and violating this rule can (and nearly always does) cause problems. See Doing Business in China with Deportation or Worse Hanging Over Your Head. What though
Companies often use share incentive programs to motivate their employees. It is possible for a PRC employee of a foreign company’s Chinese subsidiary to participate in the foreign company’s employee share incentive plan (“SIP”). However, due to China’s currency controls, whether such an employee can actually “cash out” on the benefits of such a program
The PRC National People’s Congress last week promulgated a second discussion draft of the PRC E-Commerce Law (电子商务法草案). This statute is an attempt to gain greater control over China’s online consumer markets, which have exploded with little regulation. The lack of regulation has not slowed development of e-commerce in China. The success of online marketing
China has many special laws/rules related to protecting female workers, especially those who are pregnant, nursing, or on maternity leave. For example, Chinese law generally prohibits employers from unilaterally terminating the employment contract of a pregnant or nursing employee or an employee on maternity leave. The only exception to this is that the employee may be unilaterally
