Archives for: August 2010

08/28/10

Permalink 05:10:44 am, by dacare, 657 words, 941 views   English (US)
Categories: Candidates, Labor and Worker

Expatriates Working in China with Criminal Records

By Chris Devonshire-Ellis and Richard Hoffmann

Aug. 27 – A recurring theme over the past two years for expatriates wanting to be based in China is the subject of possessing a criminal record. These may of course be for relatively minor offenses; however China’s policy in this regard can be strict.

A standard requirement (although it is not always requested) for expatriates looking to work in China is for a “Certificate of No Criminal Record” to be provided when applying for a work permit. This is a particularly strict requirement in Shenzhen and Guangzhou, though less so in Beijing and Tianjin. Providing this certificate means having to go to your local police station in your home country and obtaining one. Different countries have different systems for providing such a document, and some smaller countries can even issue this from their embassy in Beijing. For most expatriates seeking employment in China, however, this needs to be obtained from their local police authority in their home country.

The same also applies to having a criminal record in China. However, criminal records are not usually recorded in China on a national basis. Therefore, it may be possible if in possession of a criminal record in China – if the authorities have not already deported you – to apply successfully for such a work permit in a different region of China. The best advice is of course to not commit criminal acts in China. You risk your job, simple as that.

A little known aspect of China’s laws also criminalizes debts of over RMB10,000. That means that if a foreign invested company has become insolvent or bankrupt, unless the debts, including all staff obligations, taxes due and so on are met by the parent company, expatriates simply walking away from the situation risk being found guilty in absentia. This is of particular pertinence to the chief representative or legally responsible person. In these positions, the title means exactly what it says – responsible for the activities of the company, including its debts.

People can be incarcerated for long periods over debts incurred by their company in China. Returning to China knowing that you have such a background then is unwise. Expatriates’ personal data is now shared on a national basis, and even if one manages to apply for a work permit in a different city, a sharp-eyed clerk somewhere may mean a knock on the door sometime later.

The lesson for all expatriates in China is to pay your debts, and keep out of trouble. You may not get a second chance.

Foreign-invested companies in China facing significant problems in which closure becomes necessary must take the appropriate actions when doing so. Leaving China with unauthorized debt places you at significant future risk should you wish to later re-enter the China market. It is far better to negotiate with creditors than face prosecution. Most of the obligations under such circumstances can be dealt with through negotiation, and require the provision for creditors meetings. Although unpleasant, these do allow for the company to state its position firmly, abide by the rules, and decrease the amount of outstanding debt. While creditors can usually be dealt with, staff and any outstanding tax matters do need to be settled. The procedure for closure also requires an audit.

We have recently provided update advice and the procedural structure on this subject, please see the China Briefing issue “Closing Representative Offices and Liquidating Businesses in China” for more information.

Chris Devonshire-Ellis is the principal of Dezan Shira & Associates. Richard Hoffmann is a senior legal associate with the firm and is responsible for issues relating to expatriate employment and human resource legal and administrative matters in China. If you have queries about obtaining work permits in China, please contact Richard at legal@dezshira.com. Businesses requiring advice on liquidation procedures and related matters may contact Sabrina Zhang, national tax partner for the firm, in strict confidence at tax@dezshira.com.

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Permalink 05:07:27 am, by dacare, 102 words, 455 views   English (US)
Categories: Announcements, Candidates, Labor and Worker

China Bans Foreign Firms Hiring Labors in China to Work Abroad

By Bloomberg News

Aug. 23 (Bloomberg) -- China will crack down on foreign companies directly recruiting and hiring workers in China to do manual labor overseas, the Ministry of Commerce and the Ministry of Foreign Affairs said in a joint statement posted to the commerce ministry’s website today.

The government will also stop Chinese companies from sending labors from the nation to work overseas for foreign individuals, according to the statement. China will also strictly control the sending of Chinese labors to work in overseas nations where conditioners are worse than those domestically and where risks are high, according to the statement.

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