PRC-Licensed Lawyer | Shenzhen | Cross-Border & Immigration Law
Drawing on PRC law and practical experience, we share the legal insights for general informational purposes.
Setting up a Wholly Foreign-Owned Enterprise (WFOE) is considered the most straightforward route for foreign investors to establish a foothold in China. The overall process can be summarized in four steps: preparation, registration, account opening, and compliance initiation. Mastering the main line can significantly reduce communication costs and approval timelines.
1. Preparation
Investors first determine the registered location, business scope, and governance structure. The location affects licensing levels and tax obligations; the business scope should cover the main operations for the next three to five years; and the governance structure involves verifying the qualifications of shareholders, directors, supervisors, and legal representatives, as well as preparing the required documents.
2. Registration
After pre-approval of the company name, submit the establishment application to the local market supervision authority, and simultaneously complete business, tax, and seal registration. The issuance of the business license marks the legal establishment of the entity, after which invoices can be applied for and access to the electronic tax system enabled.
3. Account Opening
Using the business license and company seal, open a RMB basic account for daily transactions. After completing the foreign investment registration with the foreign exchange authority, foreign capital can be legally remitted. Once the funds arrive, they can be converted and used, providing the basis for future operations and capital verification.
4. Compliance Initiation
The company must ensure compliance in employment, industry licensing, and data management: register social security and housing fund accounts; obtain relevant administrative permits for industries such as food, healthcare, telecommunications, and education; and establish mechanisms for tax filing, annual reporting, and information disclosure to maintain ongoing regulatory compliance.
Conclusion
Procedures follow a fixed template, but risks often lie outside the template. Engaging a China-licensed lawyer throughout the process allows early identification of key risks in areas such as market access, capital flow, contract arrangements, and cross-border data, replacing uncertain administrative penalties or additional taxes with predictable costs, and achieving both safe market entry and long-term compliance.
Obtaining a business license merely means that Chinese law allows you to “start the race.”
The real journey begins afterward, through a series of “subsequent checkpoints.” The six points below summarize the most easily overlooked compliance issues that carry the heaviest penalties—perfect for posting in the office and conducting quarterly self-checks.
1. License ≠ Permission
Even if your business falls outside the negative list, industry-specific permits may still be required. Selling food requires a Food Business License, hiring employees requires a Human Resources Service License, and offering online training requires a Private Education License. Operating without a license can result in immediate shutdown and fines. If consumer harm occurs, shareholders may be held personally liable.
2. Money In ≠ Money Free
Foreign capital must be registered with the foreign exchange authority under FDI regulations to be recognized as paid-in. Otherwise, it remains “unpaid” even after five years, and shareholders are liable for company debts within their subscribed capital. Before profits can be repatriated, taxes must be settled and a Tax Clearance Report issued. Any discrepancy in historical foreign exchange usage can result in the bank rejecting the transaction.
3. Contract ≠ Employment
Failing to sign written labor contracts allows employees to claim double wages. Failing to contribute to social security triggers back payments, late fees, and administrative penalties. Delayed wage payments exceeding two months can expose responsible executives to criminal liability of up to seven years. If executives leave while the company is on the “wage arrears blacklist,” even flight tickets cannot be purchased.
4. Data ≠ Cross-Border
Collecting personal information of Chinese employees or consumers requires a provincial-level cybersecurity assessment if data from more than 10,000 individuals is transferred abroad. Transmitting data without assessment can result in fines up to RMB 50 million or 5% of the previous year’s revenue. Even if servers are located overseas, a Personal Information Protection Impact Assessment must be filed in China, or apps may be removed and mini-programs shut down.
5. Profit ≠ Pricing
Payments to a foreign parent company for management fees, trademarks, or purchase price differences must comply with transfer pricing rules. Annual related-party transactions exceeding RMB 40 million require documentation. Tax authorities can retroactively adjust for three years, applying a 25% profit rate if the transactions lack commercial substance, potentially consuming three years’ cash flow in one sweep.
6. Deregistration ≠ Disappearance
The average deregistration process takes eight months: tax clearance → customs clearance → foreign exchange deregistration → market supervision deregistration. If tax incentives were previously enjoyed, taxes must be repaid before exit; unresolved lawsuits or pledged shares prevent “simplified deregistration.” Exit terms must be written in the investment agreement; otherwise, liquidation costs can consume the remaining capital.
Conclusion
In China, compliance is not a cost—it’s part of valuation. Turning the six points above into a quarterly red-green risk report allows the board to see risks before fines arrive. Treat your business license as a long-term visa, and use continuous compliance to secure sustainable dividends and exit premiums.
After establishing a Wholly Foreign-Owned Enterprise (WFOE) in China, the real variables often emerge after the business license is issued. The following four categories of risk are frequently overlooked yet can surface dramatically during a first-round financing or exit audit. Investors are advised to include them in due diligence checklists before funding.
1. Market Access Risk: License ≠ Industry Pass
Even businesses outside the negative list often require subsequent permits. Common blind spots include:
Software outsourcing companies engaged in online data processing trigger Category B21 under the Catalogue of Value-Added Telecommunications Services and must obtain an ICP license;
Trading companies selling food with frozen components must obtain a Food Business License and register as import consignees;
Educational consulting firms offering academic tutoring must meet provincial Private School Licensing requirements for premises, teaching staff, and fire safety.
Operating without the necessary permit risks “forced closure + confiscation of illegal gains,” and in severe cases, shareholders may bear joint liability for administrative fines and late fees. The recommended solution is to include in the articles of association a clause making “obtaining all administrative permits a precondition for capital contribution” and allow a 3–6 month buffer for approvals.
2. Capital Risk: The “Unlimited Pocket” Clause under the Subscription System
While the Company Law no longer sets a minimum capital requirement, a five-year deadline for actual contribution is in draft revisions. If company debts remain unpaid at maturity, shareholders are liable up to their subscribed capital, and litigation does not protect them from the contribution timeline.
Additionally, foreign capital not registered with the FDI authority and remitted is considered “illegal contribution.” Future profit repatriation, equity transfers, or liquidation will be rejected by banks. In practice, replacing capital injection with shareholder loans and later swapping with foreign funds has repeatedly triggered monitoring by the foreign exchange authority due to inconsistent fund origins. It is recommended to make “completion of FDI registration” a precondition in offshore loan agreements, locking in both exchange rates and funding costs.
3. Employment Risk: Even Minimal Labor Contracts Can Trigger Criminal Liability
The double-wage penalty for failing to sign written labor contracts is widely known. Less obvious is the 2023 Criminal Law Amendment XII, which criminalizes “failure to pay labor remuneration” if wages are delayed for two months or more and the amount is significant. Common WFOE scenarios include:
Legal representatives residing abroad lose oversight over payroll;
Employees are split into “outsourced labor” to reduce social security costs, but the outsourcing company has no formal contracts with employees;
Equity incentives are excluded from total salary, causing underpayment of social security and housing fund contributions.
If employees file labor arbitration and seek property preservation, company accounts may be frozen. Delayed payments due to insufficient funds can expose responsible parties to up to seven years’ imprisonment. A compliant path is a “dual-key” approval: the overseas headquarters sets the budget, while domestic HR and legal jointly verify payroll records, ensuring payment by the 15th of each month with traceable records.
4. Data and Tax Risks: Dual Retrospective Risk of Cross-Border Data and Related-Party Transactions
Data transfer abroad: Under the PIPL, transferring HR or customer data of over 10,000 individuals to the foreign parent requires a provincial-level cybersecurity assessment. Unauthorized transfer can result in fines up to RMB 50 million or 5% of last year’s revenue.
Transfer pricing: Payments to the foreign parent for management fees, trademarks, or procurement price differences exceeding RMB 40 million annually require local documentation. Tax authorities can retroactively adjust for three years at a 25% profit rate, with back taxes and interest potentially eroding cash flow.
Enforcement is tightening, and authorities share information: the cybersecurity authority requires tax residency data of recipients abroad; the tax bureau can access cross-border data records during related-party audits. It is recommended to align the cross-border data strategy with transfer pricing policy, adopt “narrow desensitization + local redundancy” technical architecture, and include both “pricing basis + economic necessity” clauses in related-party contracts to reduce the likelihood of dual adjustments.
Conclusion
Standard WFOE documents are easy to replicate, but real risks lie across industry permits, capital pathways, employment compliance, and cross-border data. Early involvement of a China-licensed lawyer not only streamlines procedural registration but also establishes “risk isolation layers” across funding, employment, transactions, and exit. Fixed legal service costs replace uncertain administrative fines and criminal liability, preserving predictable capital upside for investors.
For foreign entrepreneurs establishing businesses in China, visas are not merely entry permits—they are a critical component of business operations and strategic planning. While many founders focus on company registration, fundraising, and market development, overlooking visa compliance can significantly impact business setup, team management, and capital operations.
Visa type and validity directly affect the ability of foreign founders and key management personnel to work and reside legally in China. Companies should incorporate visa planning into the overall legal compliance framework from the outset, alongside registration, business scope, and industry-specific licenses. Early planning ensures that core personnel can legally manage the company during its critical early stages, reducing administrative obstacles.
Moreover, visa compliance affects day-to-day operations. Whether executives can sign contracts, open bank accounts, handle cross-border capital, or participate in fundraising is closely tied to their legal status. Ignoring visa arrangements can delay administrative processes and even affect contract performance and fund transfers.
From a strategic perspective, visas are not just an individual compliance matter—they are part of the company’s risk management. Early planning can:
Clarify the legal scope of activities for the core team in China;
Prevent business disruptions or investor concerns due to legal status issues;
Reserve compliance space for future team expansion and personnel adjustments;
Integrate with other compliance areas, such as taxation, social security, and industry licensing.
By embedding visa planning into the overall legal strategy, founders can maintain legal status while providing a stable foundation for business decisions and capital operations.
Visa planning involves multiple regulatory areas, including immigration, labor, human resources, and industry authorities. Engaging a professional lawyer during the company’s preparatory stage helps identify potential compliance risks and provides a holistic perspective. Lawyers do more than interpret policies—they assist companies in designing practical processes that align visa arrangements with corporate governance, capital use, and personnel management.
With legal advisor involvement, companies can establish standard operating procedures to ensure every stage of identity and qualification verification is traceable and documented, reducing uncertainties from administrative inspections, policy changes, or internal errors.
Visa planning is not limited to initial entry; it is integral to long-term compliance and strategic business planning. Companies should treat visas as part of a sustained compliance system, managed in sync with business development, fundraising schedules, and team growth.
Considering visa-related risks in advance helps minimize unnecessary administrative interference and legal disputes, improves operational efficiency, and strengthens investor and partner confidence. Legal compliance provides a stable foundation, allowing core teams to focus on business development rather than being distracted by uncertain administrative requirements.
For foreign founders, visa planning is more than a personal entry issue—it is a key element of corporate strategy and legal risk management. Integrating visa planning into the company’s preparatory and operational framework can reduce uncertainty, enhance management efficiency, and ensure team stability. Early planning, collaboration with professional legal advisors, and alignment with business operations are essential to securing smooth market entry and sustainable long-term development.
When establishing a company in China, particularly a Wholly Foreign-Owned Enterprise (WFOE) or a Sino-foreign joint venture, defining the business scope is a critical yet often underestimated step. On the surface, it may appear as a simple line item in registration documents. In reality, it affects every stage of company establishment, daily operations, financing, taxation, and exit planning. An inaccurate or vague business scope can lead to administrative penalties, contract invalidity, tax disputes, and even impact investment exit.
Chinese Company Law, the Foreign Investment Law, and related regulations require companies to operate within their approved business scope. The scope defines the legal boundaries of operation and determines eligibility for industry-specific permits, tax registration, foreign exchange, and future business expansion.
For instance, a company selling food that does not explicitly include “food retail” or “catering services” in its business scope cannot obtain a Food Business License. Even if a business license is granted, operating without a permit constitutes illegal business, exposing shareholders to fines, forced closure, and potential joint liability.
Similarly, a software development company not specifying “IT services” or “data processing” in its scope may be deemed to operate beyond its authorization when providing online data services or value-added telecommunications services. This can affect website registration, the legality of online services, and contract enforceability.
Investors and financial institutions check a company’s business scope as a primary due diligence step. Vague or overly broad descriptions can create compliance risk. Terms like “technical services” or “consulting services” may be considered insufficient for specific business permits, potentially obstructing loans, financing, or the remittance of foreign capital.
Furthermore, when conducting equity financing, investors assess whether the business scope aligns with future plans. If planned activities are not covered, investors may request approvals or amendments to the articles of association, delaying financing and increasing legal costs.
The business scope directly affects tax registration type, the range of invoices that can be issued, and applicable VAT rates. For example, selling goods, providing technical services, or engaging in import/export activities each carry different VAT rates and invoice requirements. A mismatch can restrict invoicing and trigger penalties for illegal invoicing.
For foreign-invested enterprises, the scope also determines foreign exchange registration and profit repatriation routes. Certain industries, such as finance, education, and internet services, require permits before capital injection and profit repatriation. If the scope does not match permits, banks may reject fund transfers or freeze accounts.
China maintains a negative list and restricted industries. For certain sectors, the business scope is a prerequisite for obtaining administrative licenses. A company without the proper scope cannot apply for the required licenses, even with a valid business license.
Common examples include:
Food and catering: Food Business License
Education and training: Private School License
Telecommunications and internet services: ICP / value-added telecommunications licenses
Medical device sales: medical device operation permit or registration
The scope must match actual business activities to obtain the relevant approvals.
A company’s business scope also affects contract legality. Agreements outside the approved scope may be considered ultra vires, leading to partial or full invalidity.
Operating beyond the approved scope can trigger administrative fines, tax adjustments, civil liabilities, and, in some sectors, criminal liability. For example, unauthorized operation in value-added telecom or education services can result in penalties and personal liability for responsible executives.
To mitigate risk, companies should plan their business scope at establishment stage by:
Anticipating main business lines for the next three to five years;
Ensuring coverage of activities requiring industry-specific permits;
Aligning with tax compliance, enabling lawful invoicing and taxation;
Considering investor and financing needs to avoid costly amendments later;
Allowing flexibility for business expansion to reduce frequent administrative filings.
Engaging a lawyer early ensures that articles of association, registration, and license applications set preconditions and include approval buffers, reducing potential compliance and operational risk.
In China, a company’s business scope is not just a line in registration documents—it is a core control point for compliance, operations, and financing. Choosing a precise, strategic, and expandable business scope is essential for smooth establishment, sustainable growth, and efficient capital operations. Companies should treat business scope as a strategic decision rather than a procedural formality, building a compliant foundation for future development and investment exit.
For companies operating in China or foreign investors entering the market, talent management is a core strategic consideration. While different organizations define talent differently, China generally categorizes employees into high, medium, and foundational levels based on ability, experience, and influence. This article provides a high-level overview of A, B, and C talent from a strategic and legal compliance perspective.
Understanding talent categories helps companies allocate resources, design compensation and promotion systems, and plan long-term development. A-level talent typically comprises core management or technical leaders who directly influence decision-making and competitive advantage. B-level talent includes key operational roles that ensure efficiency, and C-level talent performs foundational tasks supporting daily operations.
Clear talent classification not only aids internal management but also impacts investor and partner confidence. During due diligence, acquisitions, or financing, team composition and talent structure are critical evaluation factors.
Recruitment, employment, and management in China must comply with labor, social security, and HR regulations. Different levels of talent may involve varying employment agreements, social security contributions, compensation structures, and intellectual property arrangements.
For example, A-level management personnel require contracts that clearly define responsibilities and confidentiality obligations. Key technical talent may involve equity incentives, bonus arrangements, and non-compete clauses. Foundational employees must have compliant contracts and benefits to avoid administrative or civil liabilities.
A-level talent usually consists of founders, executives, or core technical teams. Their strategic significance includes:
Steering corporate development and influencing core business direction;
Impacting capital operations, fundraising, and external partnerships;
Enhancing competitive advantage through management and technical capabilities.
From a legal perspective, employment arrangements for A-level talent involve high-risk areas such as equity incentives, non-compete agreements, confidentiality, and contract terms. Proper planning and formalized arrangements can protect company interests and minimize potential disputes.
B-level talent forms the backbone of daily operations, managing projects, departments, and technical support. Their performance directly affects operational efficiency and business outcomes.
Legally, B-level talent requires careful contract management, timely compensation, and social security compliance. Companies should establish standardized procedures to ensure contracts, payroll, and job responsibilities comply with local laws, reducing the risk of administrative penalties or labor disputes.
C-level talent handles foundational tasks, supporting daily operations and services. While their decision-making impact is limited, their role is critical to stability and efficiency.
Compliance focus includes employment contracts, working hours, social insurance, compensation, and workplace safety. Standardized management, training, and performance assessment help protect employee rights and mitigate operational risk.
Classifying talent into A, B, and C levels offers significant advantages:
Optimized resource allocation: Focus key resources on core talent for faster decision-making;
Refined compensation: Design differentiated pay and equity incentives according to role and value;
Legal risk management: Clearly define contract obligations, confidentiality, and non-compete responsibilities for each talent level;
Strategic alignment: Match talent structure to business strategy, enhancing adaptability and market responsiveness.
Investors often examine talent structure, core team stability, and legal compliance during due diligence. A formalized talent classification and management system is crucial for securing investment and establishing partner trust.
For companies operating in China, understanding and planning talent categories is a vital aspect of strategic management and legal compliance. A high-level overview of A, B, and C talent helps organizations allocate resources, design compensation, manage contracts, and implement incentives from both strategic and compliance perspectives. Early identification of key roles, clear responsibility boundaries, and standardized management processes are essential to ensuring long-term stability and sustainable competitive advantage.
Sourcing or establishing long-term supplier relationships in China is a critical element of global supply chain strategy. The Chinese market has unique characteristics, including legal, administrative, and commercial practices. Therefore, pre-contract considerations go beyond price and product quality, encompassing compliance, supply chain stability, and strategic alignment. Neglecting these factors may result in contract performance issues, supply disruptions, legal disputes, and reputational risks.
In China, company registration, business scope, and industry licenses form the basis for legal operation. Before signing, buyers should verify a supplier’s registration type, whether its business scope covers the intended cooperation, and whether it holds necessary industry permits or certifications.
China provides extensive public information on companies, including registration records, tax filings, and administrative penalties. Understanding whether a supplier has prior violations, ongoing litigation, or administrative sanctions helps buyers assess operational stability and potential risks.
Product quality is central to a successful supplier relationship. Chinese manufacturers vary in production capacity, quality control procedures, and certification systems. Buyers should clarify product specifications, quality standards, and inspection requirements before signing.
Evaluating production capacity and delivery timelines must consider seasonality, regional differences, and local raw material availability. Understanding supply chain flexibility, contingency mechanisms, and alternative sources reduces the risk of operational disruptions.
Contracts in China serve as both commercial agreements and legal protection tools. Before signing, buyers should consider governing law, dispute resolution mechanisms, and risk allocation. Chinese law imposes specific requirements on contract validity, performance scope, and administrative permissions.
Vague or overbroad contractual terms can hinder performance or trigger disputes. Involving legal advisors early helps identify potential risks and design contracts with practical safeguards.
Payment arrangements are a central concern in cross-border sourcing. Buyers should consider payment methods, staged payments, foreign exchange controls, and fund security. China’s foreign exchange regulations may affect cross-border fund transfers, making it critical to understand the supplier’s financial health, banking qualifications, and capital channels.
Staged payments, letters of credit, or controlled payment mechanisms help mitigate prepayment risks while ensuring funds flow through legal channels.
For products involving technology, design, or patents, protecting intellectual property is essential. Chinese suppliers may handle proprietary technology, information, or trade secrets during production or distribution.
Before signing, buyers should clearly define supplier obligations and responsibilities regarding technology, designs, and commercial information. Failure to address these issues may lead to IP leakage or disputes, undermining competitiveness.
Chinese suppliers are geographically diverse, and local policies, logistics conditions, and raw material availability can impact supply stability. Buyers should assess supply chain resilience, feasibility of alternative suppliers, and potential risks before entering agreements.
Strategic alignment between the supplier and the buyer’s long-term objectives is critical. Sustainable cooperation depends not only on competitive pricing but also on supplier quality management, delivery reliability, innovation capabilities, and compliance.
The Chinese market imposes strict regulatory requirements on operations and export activities, including quality standards, industry licenses, customs procedures, and taxation. Buyers should evaluate potential compliance risks and ensure that procurement activities are lawful and enforceable.
Due diligence, compliance review, and familiarity with administrative policies help mitigate legal risks while safeguarding corporate reputation and supply continuity.
Before signing with a Chinese supplier, foreign buyers must consider multiple dimensions, including strategy, legal compliance, finance, and risk management. Key factors include business credentials, product quality, contract structure, fund security, intellectual property protection, supply chain stability, and regulatory compliance.
Through early planning, due diligence, and engagement of professional legal advisors, buyers can reduce potential risks to a manageable level, making the agreement not merely a commercial transaction, but a cornerstone for a robust supply chain and long-term strategic development.
For foreign founders starting a business in China, a work visa is not merely an entry and residence permit—it is closely tied to the operation and long-term development of the company. Visa approvals and renewals are often directly linked to the company’s compliance status. Understanding how corporate compliance impacts work visas is therefore a critical legal and strategic consideration for every foreign founder.
The validity of a work visa typically depends on the company’s legal registration, business scope, and industry licenses. If a company has incomplete registration, lacks required permits, or has administrative penalties, visa approval may be delayed, denied, or even revoked.
In other words, corporate compliance is not only a legal obligation but also directly affects the founder’s legal working status. Authorities consider the company’s operational status, financial records, and regulatory compliance when evaluating visa applications.
Corporate compliance covers multiple areas, each potentially influencing visa approval:
Business Registration: Company registration information and business scope must align with actual operations.
Tax Compliance: Timely reporting and payment of taxes demonstrate legitimate business operations and financial stability.
Employment Compliance: Proper labor contracts and contributions to social insurance and provident funds indicate responsible management.
Industry Licenses and Regulatory Approvals: Companies operating in regulated sectors must maintain valid permits, or visa approvals may be restricted.
Any violation or oversight in these areas can create obstacles for visa applications or renewals.
A foreign founder’s work visa is generally linked to the company. The company’s operational stability, financial health, and compliance history are key factors for visa renewal. Pending litigation, administrative penalties, or financial issues may signal to authorities that the founder cannot continue to legally manage the company, jeopardizing visa approval.
Thus, corporate compliance is not only relevant to a one-time visa application—it affects long-term residence and the ability to maintain ongoing management activities.
Establishing a robust compliance system in advance is an effective way to reduce visa risks. Companies should conduct regular internal audits to ensure registration information, tax filings, labor contracts, and industry permits are complete and up to date. For businesses involving cross-border funds or data, compliance pathways should be planned proactively.
A documented, traceable management process allows founders to provide sufficient evidence during visa applications or renewals, improving predictability and success rates.
Professional legal advisors are particularly valuable for foreign founders. Lawyers can help establish a comprehensive compliance system and provide visa-related legal guidance, including verifying corporate legality, completeness of registration and permits, and adequacy of financial and HR records.
With legal support, founders can identify potential issues early and take corrective action, reducing visa risk. Advisors can also assist in preparing documentation, review records, and compliance proofs for visa renewal, ensuring a smoother approval process.
Corporate compliance affects not only visas but also long-term strategy, investor confidence, and market operations. Companies with strong compliance records are more attractive to investors, gain partner trust, and enable founders to continue legally managing operations in China.
Therefore, corporate compliance is both an administrative requirement and a strategic asset. It ensures the legal stability of the company and its founders, providing a reliable foundation for business expansion and capital operations.
For foreign founders in China, there is a close connection between work visas and corporate compliance. Registration information, tax records, employment practices, industry licenses, and data management can all influence visa approvals.
Proactive planning, establishing a robust compliance framework, and collaborating with legal advisors are key steps to secure successful visa applications and renewals. Viewing corporate compliance as a long-term strategic asset not only mitigates visa risks but also supports sustainable business growth, investor confidence, and ongoing operations.
Foreign nationals visiting China on a tourist (L) visa or business (M visa) must comply with Chinese laws and regulations regarding permitted activities. Violating visa conditions can lead to serious legal consequences, including fines, detention, deportation, or visa cancellation. This article provides guidance based on PRC law and practical experience.
Foreign visitors on a tourist visa are strictly prohibited from employment or earning income in China. Performing work, providing services, or receiving remuneration is illegal. Violations may result in fines, detention, deportation, and restrictions on future visa applications.
Tourist visa holders are also not allowed to run or manage a company, sign commercial contracts, or engage in business operations. Doing so may be considered illegal work or unauthorized business activity, which can lead to fines and visa cancellation.
Additionally, long-term study is not permitted under a tourist visa. Enrolling in formal courses or programs that require extended residence requires a student visa (X visa). Authorities may terminate the visa and request departure if this rule is violated.
Business visas are intended for short-term commercial activities, such as attending meetings, negotiations, or trade shows. They do not authorize employment in China. Engaging in unauthorized work can result in fines, detention, deportation, and future visa restrictions.
Business visa holders are also not allowed to register, manage, or operate a company in China. Activities such as signing legal documents, opening corporate bank accounts, or managing daily operations require a proper work permit or a Z visa. Violations may be penalized under administrative law and could affect future visa applications.
Overstaying a business visa is illegal. Staying beyond the authorized period can lead to daily fines, detention, deportation, and potential entry bans.
Always check your visa type and permitted activities before engaging in work or business operations. If you intend to work, manage a company, or provide services in China, obtain the correct visa, such as a Z visa for employment. Keep records of your activities, invitations, and travel itinerary to demonstrate compliance if questioned by authorities.
Foreign visitors on tourist or business visas must strictly observe the limitations of their visa types. Engaging in employment, company management, or other unauthorized activities can lead to serious legal consequences, including fines, detention, deportation, and future visa restrictions. Always seek proper legal guidance to ensure compliance with PRC law.
Disclaimer: These legal insights are provided based on PRC law and our practical experience, for general informational purposes only. They do not constitute legal advice or create a lawyer-client relationship. For advice specific to your circumstances, please contact us directly.