1. Australia China Business Council Victoria Event Do you need your own office in China to do Business there? Tim Lyons Managing Partner Managechina

2. Key Issues Building a bridge to China Business Model Legal Imperative Not going Native

3. Building on your Experience Business Model The model drives choice Capital Staff Case study: Embedding QC in China

4. Embedding QC in China ❖ US company ❖ Large Chinese supplier is part of their global supply chain ❖ Strictly an importation of product ❖ No need for local entity ❖ Chose a WFOE structure to embed in the Chinese Company ❖ Own employees ❖ QC cluster

5. Getting to the Point The Legal Imperative What structures are allowed The Mountains are high and the Emperor is far away What changes have or are occurring Case Study: Outsourcing to the Outsourcers

6. Outsourcing to the Outsourcers ❖ Indian brand, based in Hangzhou - part of a US publicly listed publishing house ❖ International Investment banks outsource their junior analysts to this company ❖ They then outsources some of their operations ❖ Local and Global (Big 4) Audit firm ❖ Local government registered employment agency ❖ Local compliance firm ❖ Tax breaks for outsourcers in cities like Hangzhou

7. When not to follow your Heart Not Going Native Leaving your brain on the plane Lack of clarity sometimes forces decisions Be patient Case Study: The Maddest of RO Models

8. The Maddest of RO Models ❖ Innovative web based language school ❖ Two entities ❖ RO in China ❖ BVI company ❖ We slowly discovered a dysfunctional business model wrapped in a terrifying legal structure ❖ Visa, employees, premises, taxes - all effected ❖ Forced us to rethink our engagement model