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They don't allow foreign companies to operate in China at all. You must form a 51% / 49% partnership where the 51% is a Chinese-owned company. Worse, they do h
by slowmovintarget 3y ago
They don't allow foreign companies to operate in China at all. You must form a 51% / 49% partnership where the 51% is a Chinese-owned company.
Worse, they do have different standards for domestic and foreign products. TikTok, for example, is banned in China. The approved social media app carries state crafted propaganda. A year or so ago you'd see employment information for women on WeChat. Now you see advice for staying home and raising children, because the state decided that's what women should do in China.
Chinese companies are Chinese government entities. The government there fully understands that tools like WeChat and TikTok can be used to move public opinion or distract, degrade, and erode and they use them to do exactly that.
- rahimnathwani 3y agoThey don't allow foreign companies to operate in China at all. You must form a 51% / 49% partnership where the 51% is a Chinese-owned company. The 51% can be a Chinese individual, and IIRC that's the most common way that VIE arrangements are set up. In practice, the foreign company still exerts control (via contract with the 51% owner) and keeps the profits (via contract with the JV entity). Worse, they do have different standards for domestic and foreign products. I'm curious to know what you mean by this. Do you mean: A) Different standards based on the location of the provider? B) Different standards based on the location of the consumer? If you mean (A), then I'm not sure your example supports it, unless you consider Douyin to be a foreign supplier. If you mean (B), then that's what I'm trying to say: China requires certain things of all companies (irrespective of the location of their controllers or beneficial owners).