This below is what a legitimate and legal HR agent and recruiter MUST do by law in order to obtain a business license to allow them to legally recruit foreign teachers in China. It requires them to register their real legal name and provide accountability in the case of “problems”. (Taken directly from the SAIC Legal Requirements of China)
Human Resource Agency, Human Resource Dispatch, Labor Advisory and Recruitment
In order to apply for a Recruitment License which in Chinese is a 职业介绍许可证 (this means that the company cannot handle payroll – it can only handle recruitment searches) is as follows:
The Municipal Bureau of Commerce and the Administration of Industry and Commerce in both Shanghai and Beijing will reject the applications from Foreign Investors even though the law allows foreign investors to apply for this license. This should be checked on a case-by-case basis as laws and regulations change frequently.
At this time the government will only accept Joint Venture applications.The foreign investor should be a legal entity engaged in employment agency for a minimum of 3 years. In Beijing there is no requirement in terms of the share ratio between the Foreign Investor and Chinese Investor, whereas in Shanghai the share ratio must be that the Chinese Investor owns 51% or more of the shares. The Chinese investor should be a legal entity holding the “Employment Agency License” already and should have been operational for over 1 year. The registered capital of the investment should be a minimum of USD 380,000. They have indicated that there should be a minimum of 5 staff that hold the Recruitment qualifications. The office space should not be less than 50 square meters. The Labor Bureau in both Shanghai and Beijing would accept applications from Foreign Investors as long as the Municipal Bureau of Commerce have issued the first approval certificate for the application of the Recruitment License.
The requirements are:
Minimum registered capital of USD 380,000
Investor must have been in operation for a minimum of 3 years from start date.
Alternative Solution would be to establish a *Management Consulting Company and issue service invoices for Recruitment services.
Establishment Procedure and Timeline
Establishing a foreign investment structure in China generally takes between 3 and 6 months and involves the following government authorities:
Ministry of Commerce
Administration of Industry and Commerce (AIC)
Public Security Bureau
State Administration of Taxation
State Administration of Foreign Exchange
Quality and Technical Supervision Bureau
The establishment process varies based on the foreign investment structures and the planned business scope.
Company Name Registration
Certificate of Approval
Company Chop Application and Issuance
Enterprise Code Certificate
Registration with SAFE
Foreign Currency and RMB Bank Account Openings
Issuance of the Capital Verification Report
Updated Business License
Customs Bureau (if applicable)
Once the Business License is issued the company is legally established. The process up to Step 3 varies between 6-8 weeks. The remainder of the procedures from Step 4 onwards can take between 8 and 12 weeks.
*Management Consulting Company can only do the follow:
Investment Consulting, Enterprise Management Consulting, Enterprise Planning Consulting (Excluding Advertising), Trade Information Consulting, Environmental Information Consulting, Economic Information Consulting, Scientific and Technical Consulting. (Related to administrative licensing with license management)