We want answers! Clear answers! Yes or no answers! It felt so great last time that we reached out to more lawyers to answer an eight-part medley of legal issues; from humanitarian extensions on visas, changing jobs without leaving the country, having a passenger on the back of your ebike, and whether or not you're legally required to wear a mask in a Didi.
Note: these answers are provided by legal experts, but may not apply to your specific situation. We feel like we say this a lot, but just so we're clear: waving some article you found online (even one as good as this!) under an authority figure's nose during a legal dispute is Not A Good Idea™.
Seek professional legal advice if you are in legal trouble. We have dozens of lawyers and law firms listed in our Business Directory.
Our legal panel, from left to right:
Xu Tong is a lawyer at the Yingke Law Firm Shanghai Office, specializing as an expert attorney in commercial dispute, trade structure stock right dispute, contract issues and criminal cases. Zoe Wang is also a lawyer at Yingke Law Firm Shanghai Office, focused on day-to-day legal services such as corporate labor issues, divorce disputes, dispute settlement with respect to wills, heritages and inheritances.
Art Dicker is a lawyer based in Shanghai focusing on venture capital, employment, compliance, commercial contracts, and other general corporate matters. Art is a Director at R&P China Lawyers and the host of The China Business Law Podcast which can be found on XimalayaFM, Apple Podcasts and most other podcast networks.
Yves Ying is a lawyer and director of Shanghai Jingjian Law Firm, sponsor of the "Jingjian Law" Forum, and a member of the Securities Committee of the Shanghai Lawyers Association. He has been practicing law for over a decade, specializing in commercial disputes, contract issues, corporate labor issues, trade structure stock right disputes and criminal cases.
1. I'm having a hard time getting my work permit or visa renewed. I have heard I can just set up my own company and sponsor my own visa. Is this legal?
Yves Ying: Yes. If you run your own company, you can apply for a residence permit for personal matters (marked “entrepreneurship”), but you still need to provide relevant certificates and papers when applying.
The Law: Immigration Control Act, Article 41 & Shanghai Public Security Bureau File No. A029
Xu Tong & Zoe Wang: Yes. The entrepreneurship visa is for foreign graduates and entrepreneurs who plan to start a business in Shanghai. You can find the requirements on the Online Platform for Government Affairs of Exit-Entry Administration Bureau of the Shanghai Public Security Bureau here.
The Law: Residence Permits for Personal Matters (Marked "Entrepreneurship") (A029)
Art Dicker: Entrepreneurship visas are generally difficult to get. One alternative is to set up a company and hire yourself as an employee. The includes all the setup and maintenance costs of having a company in China, of course, and you have to actually pay yourself a modest salary (and pay certain social insurance premiums with that). This is not a cheap option but it is done more often than people think.
2. My visa is expiring. I have heard I can apply for a humanitarian visa for an extension. Is this legal?
Yves Ying: Yes. You may apply for a visa extension for humanitarian reasons if your residence permit is about to expire. Humanitarian reasons include that you cannot buy an air ticket due to flight suspensions, but you should provide proof. If this case happens many times, you may apply for visa extensions multiple times.
The Law: Immigration Control Act, Article 32
Art Dicker: If you have a compelling reason – most recently for example not being able to buy a plane ticket due to flight restrictions and prohibitive costs — it's up to the local Exit-Entry Bureau whether you qualify for a humanitarian extension.
3. I am changing companies during the pandemic, do I have to leave the country and apply for a new Z visa?
Yves Ying: No. You can apply without leaving the country. Changing employers is limited to signing a new labor contract with the new employer, but you cannot work immediately. The previous work permit and residence permit must be cancelled within 10 days with a release paper issued by the former employer. After that, the immigration authority will issue a 30-day humanitarian stay visa, and the new work permit and residence permit must be applied for within these 30 days.
The Law: Immigration Control Act, Article 41, 43
Art Dicker: You really need to be careful when changing companies, especially if you are planning to leave your old company first and look for a job, or if there is any time gap between the two companies. An employer is obligated to cancel work and residence permits for departing employees within 10 days of the employee leaving the company. You should have your new application ready to go almost from the get-go, as applying to “transfer” a work permit is a much, much simpler process (avoiding the need for new health checks, embassy-notarized criminal record reports, among others.) than applying for a new work permit. Worst case scenario, your company may be convinced to not rush to cancel your residence permit in the 10 day timeframe (this is not enforced as strictly as the work permit timeframe), so as to give you some extra time to figure out your next move.
4. I was barred from entering a metro station and/or a Didi because I wasn't wearing a mask. Is that legal?
Yves Ying: Yes. During the pandemic the government has the right to take emergency measures by requiring people to wear masks in public areas, such as subways, buses and other public transport vehicles, as well as shopping malls, supermarkets, and so on. Didi's practice of requiring passengers to wear masks is not against the law.
The Law: Emergency Response Act, Article 56, 57
Art Dicker: Yes, private businesses can require customers/visitors to wear masks as a safety measure. This is not against the law.
5. What happens if I don't file my taxes on time under the new IIT regulations?
Yves Ying: First you need to stay and work in China for 183 days, then you qualify for IIT regulations. If you fail to declare, when the supplementary payment is required for income tax, you may be charged late fees. In some cases, you may be fined. Under some circumstances this may affect your visa renewal or your ability to leave the country.
The Law: Tax Collection Act, Article 40 & 44
Xu Tong & Zoe Wang: If you (taxpayer or withholding agent) don’t file taxes on time, the tax authorities shall order the taxpayer or withholding agent to make rectifications within a prescribed time limit and may impose a fine on the taxpayer or withholding agent. For cases that constitute crimes, criminal liabilities shall be investigated according to law.
The Law: Law of the People's Republic of China on the Administration of Tax Collection (Revised in 2015), Article 62, 63, 69 & Individual Income Tax Law of the People's Republic of China (Revised in 2018), Article 9
Art Dicker: For the reasons stated above you should really push to make sure your employer is filing the proper taxes on your behalf and get a copy for your records.
6. My HR said I'm required to have a Chinese name. Is that legal?
Yves Ying: No. But if you buy real estate in Shanghai and apply for property registration, you are required to have a Chinese name.
The Law: Housing Registration, Article 15
Art Dicker: No, but it certainly comes in handy. There are some things you probably cannot get done without it, for example getting a driver's license. The name on the license is your Chinese name, not your real name.
7. I have a second person riding on the back of my scooter or bicycle. Is this legal?
Yves Ying: No. Motorcycles can carry a passenger over the age of 12 on the back, but bicycles and e-bikes can only carry a passenger if they are under the age of 12, and those carrying minors under the age of 6 are required to use fixed seats. You should note that the driver and passenger must wear helmets.
The Law: Road Traffic Safety Law, Article 51, 55 and Shanghai Local Regulations
Art Dicker: Nothing to add to that.
8. My employer has told me I'm not allowed to travel either within China or abroad. Is that legal?
Xu Tong & Zoe Wang: No, your employer can not legally stop you traveling, either within China or abroad.
The Law: Labor Law of the People's Republic of China, Article 3 & Rules for the Administration of Employment of Foreigners in China, Article 22
Art Dicker: A company cannot simply restrict you from traveling outside of Shanghai or outside of China even in times of COVID. It could in theory put together a corporate policy restricting everyone equally or have a restriction applied equally for a certain kind of position in the company….. but such a policy would likely not survive a legal challenge, as it would not be seen as reasonable by the courts. So as a practical matter, the company can certainly de facto try to restrict this but you can then violate the policy and challenge any termination action against you later. Of course, this comes at a time and money cost to do so.
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