Powers of Chief Representative of a China Representative Office
The Chief Representative of a China Representative Office is the person who is responsible for the daily operation of the Representative Office (RO). However, Chinese laws do not clearly specify the limitation of the authorities of a Chief Representative or a Representative. In the absence of express statutory provisions, it is not clear whether or not documents signed by a Chief Representative or a Representative have binding force upon the foreign enterprise. Therefore, foreign enterprises should clearly set forth the authorities of the Chief Representative and Representatives of a Representative Office in order to avoid, to the greatest extent possible, situations in which the acts of a Chief Representative or a Representative have binding force upon the parent foreign enterprise.
Qualifications for Acting as Chief Representative
The Representative Offices may retain either Chinese or foreign personnel to act as the Chief Representatives. Specifically, the Chief Representative of the Representative Office must meet one of the following qualifications:
(a) he/she is a foreign citizen holding a valid ordinary passport (excluding foreign students studying in the PRC);
(b) he/she is a Chinese citizen who has obtained permanent residence status in a foreign country;
(c) he/she is a compatriot from Hong Kong, Macau or Taiwan who holds valid documentation; or
(d) he/she is a Chinese citizen (not including Chinese citizens referred to in paragraph (b) above), in which case the representative office must entrust an authorised local service unit to undertake the relevant employment formalities.
Period of Stay in China
Chinese laws do not provide for the minimum time period that the Chief Representative or Representatives must stay in China except in the case of Representative Offices established by foreign financial institutions.
Disclaimer
All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage.
A Permanent Representative office of a foreign enterprise is a non-legal entity operating in China representing its parent company. A representative office is not allowed to engage itself in business activities, issue invoices on its own, signing sales or purchase contracts, or receiving income from services performed but may act as a liaison and promotion office for its parent company.
The business scope of a Permanent Representative Office (RO, also known as Resident Representative Office) should be clearly stated in the application document prepared by the applying foreign enterprise. After approval by the relevant authority and registration with the AIC, the business scope will be stated in the Registration Certificate of the Permanent Representative Office (RO).
Permanent Representative Offices (ROs, also known as Resident Representative Offices) registered in China are non-legal entity and therefore not considered to be separate and independent from the foreign enterprises. Chinese laws do not expressly provide that ROs should bear liabilities independently with their own assets (i.e. limited liability), ROs may be deemed to be part of the foreign enterprise.
The Chief Representative of a China Representative Office is the person who is responsible for the daily operation of the Representative Office (RO). However, Chinese laws do not clearly specify the limitation of the authorities of a Chief Representative or a Representative. In the absence of express statutory provisions, it is not clear whether or not documents signed by a Chief Representative
