Representative Office vs EOR vs WFOE in China: Which Entry Vehicle Fits Your Stage?

A representative office is a non-profit liaison presence with no legal personality. It cannot do business, invoice customers or hire staff directly. An Employer of Record (EOR) lets you employ people in China through a provider's legal entity without registering your own. A WFOE is a Chinese company you own outright, and it is the only one of the three that can contract, invoice, hold assets and run operations in its own name. Early testing and pre-revenue stages usually point to an EOR or a rep office. Selling, manufacturing and sustained R&D usually point to a WFOE. This is a high-risk area, and rules change, so confirm your plan with licensed China counsel.

Table of Contents

1. The Short Answer: Match the Vehicle to Your Stage
2. The Representative Office: What the Regulation Allows and Forbids
3. How a Representative Office Hires Chinese Employees
4. How an EOR Arrangement Works in China
5. The WFOE: What It Is and What It Takes
6. Side-by-Side Comparison
7. Where the Risk Sits: Tax, Banking, Liability and Exit
8. Which Vehicle Fits Which Stage
9. Triggers for Moving From an EOR or Rep Office to a WFOE
10. Illustrative Scenario (Hypothetical, Not a Real Client)
11. Pre-Decision Checklist
12. How Knit's EOR Service Handles This
13. Frequently Asked Questions
14. Glossary of Key Terms
15. About Knit
16. Related Reading

1. The Short Answer: Match the Vehicle to Your Stage

Foreign companies tend to ask "which structure is best?" The better question is "what do we need to do in China in the next 12 to 24 months, and which structure permits it?" The three options answer that question differently.

• Representative office (rep office, RO): a standing presence for liaison and market research. It is non-profit by regulation. It has no separate legal personality, so your foreign parent remains legally responsible for it.
• Employer of Record (EOR): you do not register anything in China. A provider employs your people locally and handles payroll, social insurance and tax withholding, while you direct the daily work.
• WFOE: a company incorporated under Chinese law and owned entirely by foreign investors. It can sign customer contracts, issue invoices, lease space, hold inventory and employ staff directly.

A rough rule of thumb, which the rest of this article tests: if you are exploring, an EOR or rep office keeps commitment low. If you are earning revenue in China, making goods there or building a permanent team, you will probably need a WFOE. The details matter, though, because each vehicle has hard edges. A rep office cannot do things many founders assume it can. An EOR cannot give you a business license. A WFOE brings capital, filing and exit obligations that surprise first-time investors.

This is a high-risk area. China's rules on foreign investment, company registration, foreign exchange, tax and employment are amended regularly, and local practice differs by city and district. Treat this article as a planning aid and confirm every structural decision with licensed counsel in China.

2. The Representative Office: What the Regulation Allows and Forbids

The governing text is the State Council's Regulations on the Administration of Registration of Resident Representative Offices of Foreign Enterprises (State Council Order No. 584, promulgated November 2010, effective March 1, 2011). The official 2010 text on the Chinese central government portal is in Chinese, and a consolidated page on the Beijing municipal government site notes later amendments in 2013 and 2018. English translations circulate widely, but the Chinese text controls.

What the text says, in plain terms:

• Status. A representative office is a standing office that a foreign enterprise sets up in China to carry out non-profit activities connected with that enterprise's business. It does not have legal personality (Article 2).
• No profit-making. Article 13 states that a representative office may not engage in profit-making activities. The article also contains a carve-out for treaties China has joined, so a lawyer should check whether any treaty rule applies to your situation.
• Permitted activities. Article 14 lists what a rep office and its representatives may do. In summary: market research, display and promotion related to the foreign enterprise's products or services, and liaison activities related to product sales, service provision, domestic procurement and domestic investment. Activities that need separate approval under other laws must be approved first.
• Accounts. The office must keep accounting books at its premises and may not use the accounts of other entities or individuals (Article 7).
• Annual report. Representative offices file an annual report in a set window each year, from March 1 to June 30, covering the parent's status, the office's activities and audited income and expenses (Article 6).
• Staff size. The text provides for a chief representative and a small number of additional representatives (Article 11).
• Penalties. The liability chapter provides for orders to stop or correct, confiscation of unlawful income, fines and, in serious cases, revocation of registration. After a revocation for certain violations, the foreign enterprise may be barred from setting up a new rep office in China for five years (Article 39 in the text we reviewed). Fine amounts differ by violation and have been reported in ranges up to RMB 500,000 for profit-making activity. Verify current figures before relying on any of them.
• Hong Kong, Macau and Taiwan enterprises. The same rules apply (Article 44).

What this means in practice. Because the office is non-profit and limited to liaison and promotion, it cannot be the contracting party for a sale, issue sales invoices or collect revenue from Chinese customers in its own name. Those conclusions follow from the scope in Articles 13 and 14, and they match how the structure is generally described, but the boundary between "liaison related to sales" and "conducting sales" is where companies get into trouble. A rep office whose staff negotiate prices, sign contracts or direct a customer's payment into a China account is at risk of being viewed as engaged in profit-making activity. Ask counsel to review your actual activity list, not just the structure.

Registration authority. Under the amended regulation, registration and supervision sit with the market regulation system at provincial level, which carries on the functions of the former State Administration for Industry and Commerce. The State Administration for Market Regulation describes its role as responsible for the unified registration of market entities. The Shanghai municipal government's service guide for registering resident representative offices shows the local procedure, including a document requirement that the foreign enterprise show it has been lawfully established and operating for more than two years. Check the current requirements for your city, since each registration authority publishes its own materials list.

3. How a Representative Office Hires Chinese Employees

This is the point that surprises most founders. A rep office generally cannot recruit and employ Chinese staff the way a normal employer does. In practice, Chinese employees are engaged through a qualified foreign-enterprise employment service agency (often called a foreign affairs service unit, 外事服务单位) that employs them and dispatches them to the office.

The clearest official text we could verify is the Beijing municipal government's Administrative Provisions on the Employment of Chinese Employees by Resident Representative Offices of Foreign Enterprises, issued in 1996 and amended in 1997. The Beijing text says, in summary:

• A representative office must hire Chinese employees through an approved service agency. It may not recruit them itself or through other parties.
• Chinese job applicants must apply to the office through the agency.
• The agency signs the labor contract with the employee and pays social insurance contributions as required by law.
• The employee needs a registration card issued through the agency to work at the office, and the agency must register the employee within a short window after signing.
• Penalties apply to offices that hire directly, to agencies that supply staff without approval and to employees working without a card.

Treat this as a Beijing rule, not a national template. Other cities have their own local rules and approved agencies. A 2011 notice from Shenzhen's labor authority, reproduced on the Hong Kong Trade and Industry Department site, follows a similar agency-and-dispatch model for offices in Shenzhen and refers to a Guangdong employment permit for staff of foreign resident offices. That notice is old, and current local practice should be confirmed with the local human resources and social security bureau or with counsel before you act on it.

Consequences for planning:

• The rep office is not the legal employer of its Chinese staff. The agency is, which limits how you set terms, handle performance issues and end employment.
• Foreign nationals posted to the office are a separate matter. Residence and work-permit rules apply to them regardless of structure (the regulation requires staff to comply with entry, residence, employment, tax and foreign exchange rules, Article 8).
• Headcount is meant to stay small. A rep office is not designed to be an operating team.

If your main goal is to employ people, a rep office adds an agency layer and a non-profit scope limit without giving you the ability to contract. That is why many companies skip it. For a broader walk-through of the options for hiring before you have a company, see Knit's guide to hiring employees in China before establishing a local company, which compares rep offices, labor dispatch, contractors and EOR.

4. How an EOR Arrangement Works in China

An Employer of Record becomes the legal employer of your China-based staff. The provider issues the employment contracts, runs payroll, withholds individual income tax, registers and pays social insurance and housing fund contributions where required, and manages statutory leave and termination procedures. You decide what the employee works on, day to day. If the term is new to you, Knit's explainer on what an Employer of Record is covers the model in general terms.

What an EOR gives you:

• The ability to hire a compliant China employee without registering a company.
• A single point for payroll, contributions and employment paperwork.
• A reversible commitment. If the test fails, you end the service according to its terms and the employment arrangements.

What an EOR does not give you:

• A business license. You cannot invoice Chinese customers, sign local leases in your own name or hold a China bank account because of an EOR relationship.
• Permission to run licensed or restricted activities. If an activity needs a license, a filing or a particular entity type, an EOR does not supply it.
• A way to avoid tax exposure created by your own conduct. If an EOR-employed person in China habitually negotiates or concludes contracts for your company, a permanent establishment question can arise under your home country's rules and China's. Knit's article on overseas remote work, permanent establishment and data compliance explains the general risk.
• Support for very large teams. Many companies find that cost, control and operational needs favor an entity once a team grows. See the cost comparison of EOR and entity setup.

A regulatory flag. We could not verify a dedicated Chinese statute that regulates "EOR" as such. In practice, providers structure the arrangement through a locally registered entity and service and employment agreements, and the permissible scope of such arrangements, including how labor dispatch rules apply, depends on how the structure is built. Ask any provider and your counsel to explain the legal basis in writing. Knit's article on why companies use an EOR before setting up a legal entity in China explains what the model covers and does not cover, and the complete China EOR guide gives the step-by-step view.

5. The WFOE: What It Is and What It Takes

A WFOE is a limited liability company incorporated in China and wholly owned by one or more foreign investors. In legal terms it is a foreign-invested (foreign-funded) enterprise. The English translation of the Foreign Investment Law on the Chinese government's English portal defines a foreign-funded enterprise as an enterprise incorporated under Chinese law in China that is wholly or partly invested by foreign investors. The law took effect on January 1, 2020, and a Shenzhen government mirror of the English text shows it has six chapters and 42 articles.

Key points from the Foreign Investment Law:

• Pre-establishment national treatment with a negative list (Article 4). Foreign investors generally receive the same treatment as domestic investors at the entry stage, except in fields on the negative list, where special administrative measures apply.
• Company Law governs structure (Article 31). The organizational form, governance and conduct rules of a foreign-funded enterprise follow the Company Law.
• Information reporting (Article 34). The State operates a foreign investment information reporting system. Investors submit information to commerce authorities through the enterprise registration and credit publicity systems. The law provides for penalties when reporting duties are not met.

The negative list matters. The Chinese government's English portal reported that the 2024 edition of the negative list, effective November 1, 2024, cut the restrictions from 31 to 29 items and removed all restrictions in manufacturing. As of October 2026, confirm whether a newer edition applies. Your sector decides whether you can own 100%, need a partner or need prior approval.

Capital is a live issue. The revised Company Law took effect on July 1, 2024. The State Council's implementing provisions, reported on the government's English portal, set a five-year ceiling for paying in subscribed capital and a transition for companies registered before July 1, 2024. The English reporting is a news summary, and the transition dates were worded inconsistently across the sources we checked, so rely on counsel and the official Chinese text for the exact dates and for how the rule applies to a new company. Knit's article on 2026 WFOE legal hurdles and the EOR alternative discusses the planning implications.

What a WFOE can do that the others cannot: sign contracts and issue invoices in its own name, lease premises, open bank accounts, hold assets and inventory, employ people directly, apply for licenses its sector needs and hire foreign staff as the sponsoring employer. It also carries what any Chinese company carries: annual filings, accounting and tax compliance, local employment obligations and a formal exit process.

Speed and cost drivers. We are not giving numbers here because they depend on city, sector, capital plan, premises and your advisers. The drivers are:

• sector and whether the negative list or an industry approval applies
• the registered capital you choose and the payment schedule
• documents from the home country, such as corporate records that may need notarization and legalization or apostille processing, plus translation
• a registered address and lease
• professional fees for legal, accounting and registration support
• bank account opening and foreign exchange procedures
• the time needed after registration for tax, social insurance, housing fund and other registrations

6. Side-by-Side Comparison

The first table covers legal footing and operations. The second covers money and risk. Both are high-level, and the notes after them flag items that need counsel.

Table 1. Legal status, scope and hiring

Table 2. Money, liability and exit

Notes on the tables. The statement that deregistration requires tax, customs and foreign exchange matters to be settled comes from the liability and cancellation chapters of the regulation as summarized from the official text, and the exact time limits should be checked. The statement on personal exposure in a WFOE is a general warning, not a rule we verified. The tax cells are qualitative. Ask a licensed tax adviser to confirm the treatment for your facts.

7. Where the Risk Sits: Tax, Banking, Liability and Exit

Tax. The three vehicles produce three different tax positions, and none of them is a default tax shelter.

• A rep office is not a tax-free presence. The Shenzhen government's tax guidance for non-resident enterprises cites the State Taxation Administration's interim measures on permanent representative offices of foreign enterprises (Guo Shui Fa [2010] No. 18) among its legal bases. That page does not explain how rep offices are taxed, so we do not state a method here. Ask a tax adviser how the office will be assessed and what it must file.
• An EOR does not remove your company's own tax risk. If your staff in China act in a way that creates a taxable presence for your company, the structure does not prevent that outcome.
• A WFOE is a separate Chinese taxpayer. It carries corporate, indirect and payroll tax obligations of its own, and moving profits out brings withholding and foreign exchange steps. Confirm current rates and procedures with a tax adviser, as they change.

Banking and foreign exchange. A rep office keeps accounts in its own name and cannot run money through another entity's or person's account. A WFOE opens accounts in China. Under the State Administration of Foreign Exchange's Circular 13 of 2015, banks directly verify and handle foreign exchange registration for direct investment, instead of SAFE handling that registration itself. That circular is more than a decade old, so confirm with your bank what applies now. Capital injection, conversion and use of funds each have conditions.

Liability. A rep office has no separate personality, so any claim reaches the foreign parent. A WFOE separates the parent's liability from the company's, subject to limits. An EOR transfers employer duties to the provider by contract, but your conduct and your business risk stay with you.

Exit. Plan the exit before you enter.

• Rep office: the parent must apply to deregister within a set period after a trigger such as closing the office, and tax, customs and foreign exchange matters must be settled first.
• EOR: termination follows the service agreement and local employment rules, which is the main reason EOR suits uncertain plans.
• WFOE: dissolution and liquidation are formal processes that can take considerable time. Employee, tax and creditor obligations must be dealt with. Knit's WFOE hurdles article also discusses exit-related risks for legal representatives. Confirm current practice with counsel.

8. Which Vehicle Fits Which Stage

Use the stage first and the structure second.

Table 3. Typical use cases and the vehicle that usually fits

Stage-based decision guide.

1. Stage 0: exploring. You are researching the market, attending trade shows or talking to partners. You may need no China presence at all. A rep office or EOR hire becomes relevant only if you need a standing local person.
2. Stage 1: testing with a small team. You want one to a handful of people in China doing business development, support or engineering, and you want to stop quickly if results disappoint. An EOR fits best. Read the Knit hiring guide for China for what to expect.
3. Stage 2: pre-revenue and building relationships. You have a clear liaison purpose and do not need to invoice. A rep office is possible, though many companies keep using an EOR because the agency model and non-profit limit add friction.
4. Stage 3: first revenue. You need to sign contracts, invoice and receive payment in China. Start the WFOE decision now, because registration and banking take time and the EOR cannot invoice for you.
5. Stage 4: operations and scale. You are manufacturing, holding assets, running a larger team or building R&D. A WFOE is the normal answer, and the EOR becomes a bridge or a supplement for new locations.

9. Triggers for Moving From an EOR or Rep Office to a WFOE

Most companies do not move on a calendar date. They move when something in the business changes. Use the table as a prompt for a conversation with counsel.

Table 4. Typical triggers to move to a WFOE

How a transition usually works. You register the WFOE, open accounts, complete tax and social insurance registrations and then transfer employees from the EOR or agency to the new entity. Plan the handover carefully. Employment history, notice periods, contribution records and contract terms need counsel review so that staff are not left with a gap, and the EOR service agreement should set out transition terms from the start.

10. Illustrative Scenario (Hypothetical, Not a Real Client)

This scenario is hypothetical. It uses invented facts to show how the decision can play out. It does not describe a real client, and it is not advice for any specific company.

Assumptions. A U.S. software company, "Company X," sells a workflow tool to manufacturers. It has no China revenue. A reseller has introduced it to three Chinese prospects. Company X wants a China-based presence to support the pilot. It has a small budget, no China executive and no certainty about the market. The product handles customer production data, and Company X has not decided how it will contract in China.

Phase 1: testing. Company X hires "Employee A," a business development lead in Shenzhen, and "Employee B," a solutions engineer, through an EOR. Employee A runs meetings, demos and follow-up. Contracts are negotiated and signed by Company X's U.S. team, with payment into Company X's U.S. account. Company X asks counsel whether this creates any taxable presence and documents what Employee A is and is not authorized to do.

Phase 2: a rep office was considered and set aside. Company X's counsel notes that a rep office could handle liaison but would not allow sales contracting, would require staff to come through a service agency, would make the U.S. parent directly liable and would still leave the invoicing problem unsolved. The company keeps the EOR.

Phase 3: trigger. Two prospects agree to pay in RMB and want Chinese-law contracts, a local invoice and a data-processing agreement with a local company. The company now needs a Chinese contracting entity. Counsel confirms that its sector is not on the negative list for the planned activities and recommends a WFOE.

Phase 4: transition. Company X registers the WFOE and plans to move Employee A and Employee B into it after bank accounts and local registrations are complete. Before the move, it agrees terms with the EOR, checks contribution records and gets written advice from counsel on contract transfer. The EOR relationship ends on the agreed date, and the WFOE becomes the legal employer.

Lesson. The EOR worked while Company X was testing and had no China contracts. The business trigger was the first RMB contract, not the passage of time. A rep office would not have solved that trigger.

11. Pre-Decision Checklist

Work through these questions with your counsel and finance lead before you choose.

Activity

• Will anyone in China negotiate, sign or collect payment on contracts for us?
• Do we need to invoice Chinese customers or receive RMB?
• Will we manufacture, store goods or provide a licensed service?
• Does our sector appear on the current negative list, or need an industry license?

People

• How many people do we expect to hire in the next 12 and 24 months?
• Are any of them foreign nationals who need work and residence permits?
• Who will manage them, and what authority do they have?
• Do we need to control IP, data and confidentiality terms directly?

Money and tax

• What is our home-country tax position on China activity, including permanent establishment risk?
• Can we fund a WFOE's capital plan, and do we understand the paid-in capital timeline under the revised Company Law?
• How will profits, fees or royalties move between China and our home country?

Control and exit

• If this fails in 12 months, how do we leave, and what does that cost?
• Who will serve as legal representative and director of a WFOE, and what exposure comes with that role?
• What does our service agreement say about transition from an EOR to our own entity?

Documents

• Do we have corporate documents from the home country that must be notarized, legalized or apostilled and translated?
• Do we have a registered address and lease or a plan for one?

Confirmation

• Has licensed China counsel reviewed the plan and confirmed current local practice in our city?

If you answer "yes" to the first three activity questions, a WFOE is probably on your path. If you answer "no" to all of them and only need one or two people, an EOR is likely enough.

12. How Knit's EOR Service Handles This

Knit's Employer of Record services cover the employer-side work for staff hired in China: employment contracts, payroll, individual income tax withholding, social insurance and housing fund contributions where applicable, and statutory employment administration. Knit has a China operations hub in Shenzhen. You direct the work of your people, and Knit acts as the legal employer under the service agreement. Knit also offers entity registration as a service for companies that decide to move from EOR to their own entity.

Some limits are worth stating plainly. An EOR does not make your company eligible to invoice in China, hold a business license or carry out licensed activities. It does not replace advice from licensed China counsel on your structure. Knit does not publish prices or service timelines in this article, so ask for a written quote and scope when you evaluate any provider. To discuss your situation, you can contact the Knit team.

13. Frequently Asked Questions

1. Can a representative office in China hire employees directly?

Generally no. The Beijing municipal provisions we reviewed require representative offices to recruit Chinese staff through an approved service agency, which signs the labor contract and pays social insurance. Other cities have their own local rules, so confirm current practice for your city with local authorities or counsel before hiring anyone.

2. Can a representative office sign sales contracts or invoice customers?

No, not as a basis for doing business. The regulation says a representative office may not engage in profit-making activities and limits it to market research, display and promotion, and liaison related to sales, services, domestic procurement and investment. Sales contracting and invoicing fall outside that scope. Confirm your specific activities with counsel.

3. What is the difference between an EOR and a WFOE?

An EOR is a provider's legal entity that employs your staff on your behalf, so you register nothing in China. A WFOE is your own Chinese company. A WFOE can contract, invoice, lease and hold assets, while an EOR only handles employment. Most companies use an EOR to test and a WFOE to operate.

4. Is an EOR cheaper than a WFOE?

It depends on headcount and time. An EOR avoids registration and capital costs, but charges ongoing fees per employee. A WFOE has setup and compliance costs, then lower marginal cost per employee as the team grows. We do not give numbers here. See Knit's cost math comparison and ask advisers for quotes.

5. Does a WFOE have to be 100% foreign-owned?

A WFOE is by definition wholly foreign-owned, but ownership rules depend on your sector. The Foreign Investment Law applies a negative list, and the 2024 edition reportedly lifted all restrictions in manufacturing. If your field is on the current list, you may need a partner or approval. Check the latest edition with counsel.

6. How long does it take to set up a WFOE?

There is no single answer, so we do not give one. Time depends on your sector, city, documents, address, capital plan, bank procedures and the registrations that follow incorporation. Ask counsel for a plan with milestones for your city, and add time for notarization and translation of home-country documents.

7. Can I hire a foreign national through a rep office or an EOR?

Work and residence permits apply to foreign nationals under Chinese rules, whichever structure you use, and the sponsoring employer matters. A rep office regulation requires staff to comply with entry, residence, employment, tax and foreign exchange rules. Confirm the permit route with counsel, since it varies by role and city.

8. When should I move from an EOR to a WFOE?

Move when your business needs something the EOR cannot give, such as signing and invoicing contracts in China, leasing premises, holding inventory, obtaining a license or growing a larger team. A first RMB contract is the most common trigger. Begin planning before the trigger, because registration and banking take time.

9. What happens to EOR employees when I open a WFOE?

They can be transferred to the WFOE as the new employer, but the handover needs planning. Contribution records, notice terms, contract terms and the EOR agreement's transition clauses all matter. Have counsel review the transfer so employees keep their rights and you avoid a gap in coverage.

10. Is a rep office easier to close than a WFOE?

Usually it is simpler, but not trivial. The parent must apply to deregister within a set period after a trigger event, and tax, customs and foreign exchange matters must be settled first. A WFOE needs formal dissolution and liquidation. Both need advisers, and a rep office closed after serious violations can carry a re-entry bar.

14. Glossary of Key Terms

Contractor of Record (COR): a service that manages the engagement and payment of independent contractors in a country, separate from employment.

Employer of Record (EOR): a provider that acts as the legal employer of your staff in a country, while you direct the work.

Foreign-funded (foreign-invested) enterprise: an enterprise incorporated under Chinese law and wholly or partly invested by foreign investors, as defined in the Foreign Investment Law.

Foreign service agency: an approved agency that provides Chinese employees to foreign enterprises' representative offices. The agency signs the labor contract with the employee.

Housing fund: a statutory housing contribution that employers and employees pay in China, with rules that vary by city.

Negative list: the list of fields in which foreign investment faces special administrative measures such as ownership limits or approval.

Permanent establishment (PE): a taxable presence in a country created by a foreign company's activity there, under tax treaties and domestic rules.

Representative office (RO): a standing office of a foreign enterprise in China that may conduct non-profit liaison and related activities but has no legal personality.

SAMR: the State Administration for Market Regulation, China's authority for market entity registration.

SAFE: the State Administration of Foreign Exchange, China's foreign exchange regulator.

WFOE: a wholly foreign-owned enterprise, meaning a Chinese company owned entirely by foreign investors.

15. About Knit

Knit People (万领钧) is a global employment services provider founded in Canada in 2015, with about 11 years of experience, more than 4,000 clients, coverage in 172 countries and regions, over USD 600 million in annual payroll processed and 60+ owned entities. Knit's services include Employer of Record, PEO, Global Payroll and Contractor of Record, and it holds MSB license No. M23187879. Knit also operates a China operations hub in Shenzhen. To learn more about Knit's Employer of Record services or to speak with the team, contact Knit.

16. Related Reading

• 2026 China Market Entry: WFOE Legal Hurdles and the Employer of Record Alternative
• EOR vs. Setting Up a Foreign Entity: The Cost Math
• Why Companies Use an EOR Before Establishing a Legal Entity in China
• Hiring in China: What to Know and Why Use an EOR

This article provides general educational information about market entry and employment options in China as of October 2026. It is not legal, tax or immigration advice. Chinese laws, regulations, negative lists, capital rules and local registration and employment practices change and differ by city and sector, and some provisions cited here come from older or translated texts that may have been amended. Representative office, EOR and WFOE arrangements carry significant legal and tax risk. Confirm your plan, including activity scope, hiring method, capital, tax and exit, with Knit's local team or licensed China counsel and tax advisors before acting.