For many enterprises, an important first step in establishing a China presence is to bring in experienced overseas staff. This advisory describes the procedure and documentation required for expat employees to obtain work visas, and outlines the scope of China's expatriate employment policy.
Hiring process overview
Standard procedure for hiring an expatriate is normally a five-step process. The employer generally needs to: (i) apply to the local labor bureau for an Expatriate Employment Permit before the expat enters China; (ii) when the permit is issued, apply for a Visa Notification Letter from the relevant local authority (in Shanghai, the Foreign Affairs Office); (iii) have the original Expatriate Employment Permit and the Visa Notification Letter sent to the expat for them to apply for a work visa at a China embassy or consulate in their home country; (iv) once the expat arrives in China, assist them in obtaining an Expatriate Employment Certificate from the local labor bureau; and (v) when the Expatriate Employment Certificate is issued, assist the expat in obtaining an Expatriate Residency Permit from the municipal public security (police) office.
Certain expatriates, however, are not allowed to enter China.
In accordance with the Implementing Rules of the Expatriates' Entry and Exit Law, foreigners cannot enter China if they: (i) have been previously expelled from the country (and the term of expulsion has not expired); (ii) conduct terror or subversive activities; (iii) commit smuggling, drug trafficking or prostitution; (iv) suffer from psychosis or infectious diseases (i.e., leprosy, AIDS, venereal diseases, pulmonary tuberculosis, etc.); (v) cannot afford their expenses or stay in China; and (vi) will possibly harm China's national security and interests or conduct other malicious activities.
In addition to the foregoing proscriptions, Article 12 of the Implementing Rules also provides that Chinese border inspection authorities may, more obviously, prevent from entering China those expatriates who: (i) do not hold valid passports, certificates or visas; (ii) hold fabricated, altered or other individuals' passports or certificates; (iii) refuse to show their certificates; and (iv) are not allowed to enter China according to the notice of the Public Security Ministry and National Security Ministry.
Employees subject to Chinese expatriate employment regulations
China's expatriate employment regulations are more encompassing than an employer or employee may anticipate. Expatriates are subject to China's employment regulations under the following two circumstances: (i) where an expatriate signs an employment contract with an employer in China, requiring them to work in China; and (ii) if an expatriate signs an employment contract with an employer outside China, and if the expat will work in China for a period longer than three months.1
Requirements of the expatriate employee
Articles 6 and 7 of the Expatriate Employment Rules establish the following requirements for the expatriate employee: (i) the position the expatriate will fill should have special demands that cannot be met by a domestic employee; (ii) the occupation is not illegal under Chinese law; (iii) the expatriate is over 18 years of age and healthy; (iv) the expatriate is professionally qualified to hold the position; (v) the expatriate does not have a criminal record; (vi) the expatriate has a definite employer; and (vii) the expatriate holds a valid passport or equivalent international traveling certificates.
Expatriate Employment Permit — Under China's Expatriate Employment Rules, an employer should apply for an Expatriate Employment Permit for an expatriate employee before the expat enters China. Only after the Permit is obtained can expats apply for a work visa at a China embassy or consulate in their home country.
As part of the Expatriate Employment Permit application, in accordance with Article 11 of the Rules, an employer should present the following documents to the relevant government authorities: (i) the Expatriate Employment Application Form; (ii) the Expatriate Employment Application Letter, which clarifies the reason for employing the expatriate and their position; (iii) copies of the employer's business license and approval certificate; (iv) the employer's Organization Institution Code Certificate; (v) the expatriate's comprehensive résumé in Chinese with the employer's seal; (vi) the expatriate's qualifying certificates or evidence (if unavailable, the expatriate's relevant experience and capabilities should be substantiated by their former employer); and (vii) a copy of the expatriate's passport (photo page). The Expatriate Employment Permit is generally valid for six months.
Upon receipt of the Permit, expats and employers should undertake specified formalities as described below:
Visa Notice and Visa Application — According to Article 14 of the Expatriate Employment Rules, the employer should not directly send notice to the expatriate for issuance of the Expatriate Employment Permit. Instead, notice must be sent by the authorized government agency. The employer should apply for the Visa Notification Letter from the relevant local authority.
This application process entails presenting: (i) copies of the employer's business license and approval certificate; (ii) a copy of the expatriate's valid passport; (iii) the original Expatriate Employment Permit; and (iv) the Visa Notification Letter itself (completed by the employer and affixed with its seal). Upon receipt of the aforementioned documents, the authorized government agency will issue the Visa Notification Letter and will dispatch the same, along with the original Expatriate Employment Permit and the Visa Notification Letter to the expatriate abroad. The expatriate may then apply for a work “Z” visa at a China embassy or consulate in their home country.
Visa Application — According to Article 5 of the Expatriates' Entry and Exit Law Implementing Rules, the expat should present the following documents when applying for a work visa: (i) their valid passport; (ii) the visa application form; (iii) two passport photos; and (iv) the Visa Notification Letter issued by the authorized government agency.
Medical Examination — Upon arrival in China, expats should visit the health center of the local Inspection and Quarantine Bureau (IQB) to obtain a health certificate for domestic employment and residence. In most cases, they will be required to undergo a medical examination at the health center of the (IQB). However, if expats have undergone a medical exam within six months before their arrival in China, and if that exam is as comprehensive as the one conducted by IQB, then the medical examination may be waived.
To obtain the health certificate, expatriates must provide IQB with the following: (i) their valid original passport and a copy of it; (ii) a copy of their employer's business license; (iii) the valid Expatriate Employment Permit; (iv) two passport photos; and (v) the complete medical examination report, if they underwent the medical examination abroad.
If IQB deems the exam comprehensive enough, it will issue a health certificate. If IQB determines the exam to be insufficiently comprehensive, it will require the expatriate to undergo further examination, for which a fee will be charged.
Expatriate Employment Certificate — Article 16 of the Expatriate Employment Rules requires than an employer obtain the Expatriate Employment Certificate for the expatriate within 15 days of entering of China. To obtain the Certificate, the employer should provide the following documents to the relevant local authority: (i) an Expatriate Employment Registration Form; (ii) an Expatriate Employment Application Letter from the employer setting forth the employment term, affixed with the employer's seal; (iii) the original Expatriate Employment Permit; (iv) a copy of the employment contract between the employer and the expatriate, in Chinese (if the expat is assigned to China by an employer located abroad, and the expatriate's salary, labor insurance, etc., will be paid by that employer, or if the expat is technical staff and will not sign an employment contract with the employer in China, then certificate documents issued by the employer abroad should replace the employment contract); (v) the expatriate's original passport and a copy of it; (vi) a copy of the health certificate from IQB; and (vii) three passport photos.
Residence Permit — Both Article 17 of the Expatriate Employment Rules and Article 16 of the Expatriates' Entry and Exit Law Implementing Regulations require that, within 30 days of the expatriate's entering China and after obtaining the Expatriate Employment Certificate, expatriates must visit the municipal public security (police) office to apply for a Residency Permit.
Article 17 of the Rules stipulates that the following documents need to be provided when applying for the Residency Permit: (i) the original Application Letter from the employer; (ii) a copy of the employer's business license and approval certificate; (iii) a copy of the expatriate's health certificate; (iv) two passport photos; (vi) the expatriate's passport; and (vii) a Residence Application Form completed by the expatriate. After the expat obtains the Residency Permit, they are a legal expatriate employee in China.
The process above describes only standard procedures for normal expat employment. Specific procedure will vary if the expat holds a Chinese green card, if they can be deemed an expert, if they switch from one Chinese employer to another, etc. In addition, the police in different cities may have different local policies to handle expat visa issues. Therefore, it is better to get advice on specific cases than to rely on the standard procedure.
It is advisable to have a separate and comprehensive system in place to ensure full compliance with expat employment. After hiring expat employees, more issues will require attention, such as whether the employment of expat employees is subject to Chinese employment law, how to handle the termination of expat employees, and how to deal with welfare and benefits for expat employees.
1 Exception: If the expatriate is a technical professional or staff working in China to perform any technology transfer