In our previous issue dated September 15, 2011, we discussed the national social security scheme applying to both Chinese companies and their employees (including local PRC and foreign nationals). The basic regulatory framework of this scheme is made up of the Social Security Law, its Implementation Rules as well as the Provisional Measures on the Participation in the Social Security Scheme by Foreign Employees Working in China (“the Provisional Measures”), issued by the Ministry of the Human Resources and Social Security (“MHRSS”) dated September 6, 2011. However, there are still various unclear issues which have not been specified in these policy documents.
On December 2, 2011, the MHRSS issued a Circular Renshetingfa  No. 113, titled “Notice Clarifying Certain Issues Regarding the Participation in the Social Security Scheme by Foreign Employees Working in China” (“Circular 113”) to further clarify some points of concern/uncertainty arising from the aforementioned regulations that affect foreigners participating in the social security scheme. Circular 113 has been circulated by the MHRSS for a while but has only been formally released on its official website recently.