China exit restriction Exit Ban

In China, an "Exit Ban" (出境限制) is a legal measure that can be applied to foreigners, often without prior notification. Most individuals only discover they are restricted when they are stopped by customs at the airport or border crossing.

Based on the Exit and Entry Administration Law of the PRC and recent judicial practices in 2025, here are the primary issues that can lead to an exit restriction:

1. Civil and Commercial Disputes (The Most Common Trigger)

Under Article 28 of the Exit and Entry Administration Law, a court can restrict a foreigner from leaving if they are a party to an unresolved civil case.

• Unpaid Debts: If a Chinese company or individual sues you for an outstanding debt (e.g., failed business payments, unpaid rent), they can petition the court to place an exit ban on you until the debt is paid or a guarantee is provided.

• Corporate Liability: If you are the Legal Representative (法定代表人) or a senior executive of a company involved in a dispute, you may be held personally responsible for the company's "frozen" status, even if you weren't personally involved in the transaction.

• Labor Disputes: Unpaid salaries or social security contributions for employees can lead to a court-ordered exit ban during the arbitration or litigation process.

2. Criminal Investigations and Trials

This is the most severe category. You will be restricted from leaving if you are:

• A Suspect or Defendant: Involved in an active criminal investigation (e.g., fraud, assault, or illegal business operations like crypto trading).

• A Key Witness: In some cases, authorities may prevent a witness from leaving if their testimony is deemed essential to a high-profile criminal or national security case.

• Serving a Sentence: If you have been convicted but have not yet finished serving your sentence or paying your court-ordered fines.

3. Tax Arrears (Unpaid Taxes)

The Chinese tax authorities have the power to notify the exit and entry administration to block the departure of any foreigner who has significant unpaid taxes.

• Personal Income Tax (IIT): This often happens to high-earning expats or "Digital Nomads" who failed to properly file or pay taxes during their stay.

• Company Taxes: If your business has tax liabilities, you as the owner or manager may be prevented from exiting until the taxes, interest, and penalties are cleared.

4. National Security or "Public Interest"

Article 12 and Article 28 also grant broad powers to the Public Security Bureau (PSB) or State Security to restrict exit if:

• Your departure is deemed a threat to national security or interests.

• You are involved in an investigation related to state secrets or "sensitive" industries.

• Diplomatic Leverage: International observers note that exit bans are occasionally used in complex geopolitical disputes involving foreign government employees or high-profile tech executives.

Summary Table: Exit Ban Triggers for Foreigners

Strategic Advice fromwww.hirelawfirm.cn

An exit ban can last for months or even years while a case winds through the Chinese court system. If you suspect you are at risk:

1. KYC Your Partners: Ensure your Chinese business partners are stable. Many exit bans are triggered by "Long-range fishing"—where local plaintiffs sue foreign executives to force a settlement.

2. Verify Your Tax Status: Before leaving China permanently, obtain a Tax Clearance Certificate to ensure no red flags remain in the system.

3. Hire a Professional Mediator: If a civil dispute arises, it is often faster and cheaper to settle out of court through a lawyer than to wait for a court to lift an exit ban.