How Many Expats Can We Hire?

Question: I’ve recently opened a small local company and quickly found that I cannot legally hire more than one foreigner. I don’t understand the reasoning. What are the laws regarding how many foreigners a company can employ?

Answer: This is a typical example where what happens in practice is not reflected in or supported by the actual law. There are no regulations from the Exit and Entry Bureau or other bureaus stating that a company cannot hire more than one foreigner.

In particular, for a Wholly Foreign Owned Enterprise (WFOE), there is no limitation on the number of expats employees to be legally hired as long as the person is at least 18 years of age and in good health, possesses professional skills and job experience required for the work to be performed, has no criminal record and has a valid passport.

In practice, to the discretion of the approval authority, if the scope of operations is limited or “small” or deemed not able to generate enough revenue then the bureau shall challenge the need to hire an additional foreigner. Sometimes the number of foreigners over the number of total staff, including locals, is also taken into consideration to grant additional work permits.

For a Representative Office (RO), things are different. ROs are not allowed to hire directly and normally a human resource agency is involved to sign contracts with the RO on one hand and staff on the other. In most cases, no more than four foreign employees can be hired per RO.

Every month, we will feature a Q&A with Dezan Shira & Associates. Please send us your business-related questions to editor@heredg.com and keep an eye out for an answer in this space!