Sounds like they run their servers outside China. This works if most of your users are outside China. It can be highly problematic if most users are inside Ch

Sounds like they run their servers outside China. This works if most of your users are outside China. It can be highly problematic if most users are inside China. I do not agree with using "pseudo-legal registration hacks" unless you really have to, that is, your business is doing things the China gov frowns upon or your biz model can't be easily classified. In years past, there was little choice. Now, its not too difficult to run a proper China Internet entity. You do need a local Chinese company to hold your Internet operating license. This is not your license for your business and real/intellectual property, this is a license for operating a server in China. This creates trust and contract issues, but there now exist trustworthy partners. I recommend to anyone wanting to target the China market to have a local Chinese business partner. It doesn't matter how smart an expat you are, the locals will always understand some things better than you. Hosting within China does cost more. As an example of the low end of server hosting, I ran a 2U server (I owned it) for an annual fee of $1200. For that I receive an unmetered 1Mb connect. That was the contract. In reality, I was connected to the IDC's 100MB switch and nothing was managed. I never had problems. Some IDCs are better managed than others. As for payments, if your users are paying outside China, you use a HK or other entity for those payments (you'll most likely need an HK entity anyway to comply with China regs). For payments in China, use a China bank and China payment system. Final note: for bootstrapping and proof of concept stuff, it can make sense to crank things up in the U.S. or HK and ignore all local rules until you know more. But you should plan to clean up your China requirements as soon as possible.