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Operating in China without a WFOE

Los Angeles, CA |

Is it possible to represent a company, and send folios and pitch deals, without a WFOE? Technically, they said it was illegal to employ people without a WFOE, but what if they hire people in China to do their work, and they reimburse with the US office without a contract? But there is a paper trail that the office does this, that she is assisting a representative of the US Company, who is proposing JV deals, without a WFOE? And what if they are paying for these "employees" expenses? Are they allowed to have a return address for this US company, using their China home addresses as office addresses, and making it look like there is an actual office in china when they are dealing?

Attorney Answers 1


I find your question somewhat confusing so I will try to break it down a bit.

It is possible to operate legally in China without a WFOE. One can do that with a rep office. It is critical, however, to know the differences between a WFOE and a rep office and, most importantly, the limitiations of a rep office.

All employees in China are required to have written contracts and the penalties to employers without them can be severe.

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