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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?

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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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