There are three types of commonly used foreign investment vehicles in the People’s Republic of China (“PRC”), which are: wholly foreign owned enterprises (“WFOEs”), Sino-foreign joint ventures (“JVs”), and foreign enterprises’ representative offices (“Rep Offices”).  WFOEs and JVs, as PRC-incorporated companies, can hire PRC individuals directly.  Rep Offices are not independent PRC legal entities and are merely offices representing their foreign parents.  Rep Offices are not permitted by PRC law to hire PRC individuals directly.  Instead, they have to hire PRC individuals indirectly through PRC-licensed labor agents (e.g., FESCO and CIIC).  The labor agent will be the nominal employer of the PRC individuals hired for the Rep Office, and it will dispatch such PRC individuals to the Rep Office to provide employment services.  The relationship between the labor agent and the Rep Office is typically governed by a service agreement, including an indemnification arrangement under which the labor agent’s obligations and liabilities as an employer are assumed by the Rep Office.