We describe our model in four words on the homepage: Western contracts, native execution. That phrase covers a lot of ground. This article shows what it actually means, scenario by scenario.
When a creator decides to operate seriously in China, three paths exist in the market:
Hire a localization company. They translate and culturally adapt your content. That's the entire scope. They don't sign sponsorship contracts on your behalf, don't operate your Chinese accounts, don't handle IP enforcement, don't do business development, don't represent you in China. They're a vendor; you're the operator. Everything beyond translation is your problem to solve, with separate vendors for each piece.
Sign with a Chinese MCN or operations partner. They handle China end-to-end: contracts, account operation, content production, monetization. The structural cost is control. Under Chinese platform terms and Chinese contract conventions, the Chinese-side partner typically registers the accounts they help you build, signs the contracts they negotiate on your behalf, and holds the practical leverage in any dispute. You get an operator who can do everything in China — at the cost of becoming dependent on a single Chinese entity that operates under its own legal jurisdiction, its own incentives, and its own definition of what "your" assets are.
The dual-entity model. Two legal entities working in tandem. A Canadian entity contracts with you under Canadian law, pays you in your currency, and is your single point of accountability. A Chinese entity operates on the ground in China — running accounts, signing local contracts, handling IP enforcement, dealing with platforms and brands. The Canadian entity protects your interests under a legal system you can actually use. The Chinese entity does the work that has to happen inside China. Neither entity could do its job without the other.
Below: five scenarios that creators actually face when operating in China. For each, what happens under each of the three paths.
Scenario 1A Chinese brand wants to sponsor you
A Chinese brand emails through their marketing agency. They want a campaign: one main video, three short-form pieces, and posts on your Chinese accounts. Budget: 200,000 RMB. They want to sign within two weeks.
Your localization company doesn't sign sponsorship contracts. Sponsorship isn't their service.
You're handling this directly with the brand. The contract is in Mandarin, between you and a Chinese entity, governed by Chinese law, payable in RMB. You don't have an RMB-receiving account, so the brand has to wire to a Western bank. Their finance team says they can't — Chinese foreign exchange rules don't allow it for this transaction type, or their internal compliance won't approve the offshore wire. The deal stalls. You either walk away, or you sign and discover 90 days later that the wire never arrived.
In practice, the deal pool reachable through this path is limited to the 15–20% of Chinese brand sponsorships where the brand already has an offshore-payable workaround in place.
The MCN signs the contract with the brand on your behalf. They take a percentage cut, defined in your master MCN contract. The contract between the MCN and the brand — the document that actually governs the campaign and the gross payment — is not always disclosed to you at the deal level.
If there's a dispute between brand and MCN, that dispute lives in Chinese courts between two Chinese entities, and you aren't a party to it. If there's a dispute between you and the MCN about what was paid, your contract with them is in Chinese and enforceable only in China.
What you walk away with from this deal: whatever the MCN passes through, on the schedule the MCN's finance team executes.
You hold one master agreement with Ciao Canada — in English, governed by Canadian law.
For this specific deal: Ciao China signs the Chinese-language sponsorship contract with the brand. The contract states the brand pays Ciao China 200,000 RMB gross. Ciao China deducts the percentage specified in your master agreement; the remainder transfers to Ciao Canada via the cross-border channel both entities maintain. Ciao Canada pays you the net in your currency on the schedule your master agreement defines.
You see the original brand contract, with English translation provided. You see the gross figure. You see the exact deduction. You see the transfer in.
If the brand defaults: Ciao China has direct legal standing in Chinese courts against the brand entity. We carry the cost of recovery; your share follows when recovery completes.
If you ever dispute something with us: you file against Ciao Canada in Canadian court, under an English contract, with Canadian counsel.
Scenario 2Who actually owns the Chinese account
You launch on Bilibili and Xiaohongshu. Accounts open, get verified, start posting. Six months in, the account on each platform has 80,000+ followers. Translations are running. Comments are being managed.
Your localization company delivers Chinese-subtitled video files. You upload them to the accounts yourself, or someone on your team does.
The account is registered to whatever entity registered it — usually you personally, or your home-country LLC. Under Chinese platform terms, the account belongs to the registrant.
But the vendor doesn't do verification (see the previous article for what verification actually requires). Doesn't do account operations. Doesn't manage comments. Doesn't pursue takedowns when someone re-uploads your content to a fake account using your name. You own the account; you don't have the operational infrastructure to defend it, grow it, or monetize it.
The MCN typically registers and operates the account themselves. This is the standard MCN structure in China: they take responsibility for account growth, which they translate into the right to register and operate. Under Chinese platform terms, the account belongs to the registrant — the MCN.
Your MCN contract may include "co-ownership" language or grant you usage rights. Under Chinese contract law, that language is enforceable only in Chinese courts, and the practical access to the account — login credentials, posting access, monetization links, withdrawal of revenue — is controlled by the MCN's day-to-day team. Most MCN contracts also include a "departure period" (离职期) during which the MCN retains operational control after termination, "to complete the handoff." That period can extend for months.
What you walk away with if you exit: whatever the contract gave you, interpreted by Chinese courts, executed at the speed the MCN chooses.
The account is registered to an entity that's contractually yours — you personally, your existing LLC, or a Chinese subsidiary owned by you, depending on which platform and which monetization layer is involved. Ciao China operates the account as your contracted agent, with operational access granted through delegated permissions, not ownership transfer.
The Chinese-language content we produce on your behalf has its copyright assigned to you from the moment of creation. Our service agreement with you assigns all derivative-work IP rights to you, not to us. This is unusual in the industry — the standard contract structure puts work-for-hire ownership with the operator — and it took several rounds of legal structuring to set up correctly.
If you exit: the account stays in your name. The content stays under your copyright. Operational access reverts to you or whoever you designate next.
Scenario 3Selling products in China
You've built an audience. Now you want to sell something — branded merchandise, a digital course, a co-branded physical product. The question is who runs the sales infrastructure.
Your localization company doesn't do e-commerce. You need separate providers for: a Chinese e-commerce storefront (Taobao, Douyin Shop, Xiaohongshu Shop, or others), a Chinese payment processor, a fulfillment partner, a Chinese-language customer service team meeting the platform's response SLA (often three minutes during operating hours), and a cross-border revenue arrangement that handles tax and foreign-exchange compliance.
That's five or more separate vendor relationships, each Chinese-language, each with its own contract. You become a vendor manager for a Chinese e-commerce business that runs in a language and legal system you don't operate in.
The MCN handles the entire e-commerce stack. The merchant account is registered in their name. Payment processing routes through them. The customer-service team is theirs. Fulfillment is their supplier relationship.
The store name often appears alongside their brand, or makes the storefront identity ambiguous to the consumer. Revenue flow: Customer → MCN merchant account → MCN finance → you, less their cut.
If you exit, the store is theirs. The merchant account, the customer database (if any), the platform ranking history, the supplier relationships — all on their side.
Ciao China sets up the storefront under your entity — a Chinese subsidiary owned by you, or a co-branded structure depending on each platform's merchant rules. Operational management runs through Ciao China's customer-service and fulfillment teams, but the merchant account, the store name, and the customer base are registered to you.
Revenue flow: Customer → store under your entity → Ciao China operations (deducting the agreed operational percentage) → Ciao Canada → you. Each transfer is documented and appears in your monthly reporting.
If you exit: the storefront stays yours. The customer database transfers with it. The fulfillment relationships are documented and transferable. Ciao China's operations team disengages on the schedule your master agreement specifies.
Scenario 4A dispute hits
Something goes wrong. The Chinese brand sponsor stops responding 60 days after the campaign airs, with the second payment installment unpaid. Or you discover your translated brand name was filed as a Chinese trademark by an unknown third party. Or someone re-uploads your video to a fake account that's gaining its own following on the back of your content.
Your localization company isn't involved in disputes. Disputes are between you and the counterparty, directly.
The counterparty is in China. The relevant court is in China. Your lawyer is in your home country. The cost-benefit math of pursuing the dispute — translator fees, Chinese counsel retainer, travel for testimony, a multi-year timeline — almost never works out for a single creator pursuing a single counterparty. In practice, most disputes from this path get absorbed and written off.
The MCN handles disputes — for the disputes the MCN wants to defend.
If a Chinese brand owes the MCN money, the MCN pursues recovery because the MCN's revenue is on the line. You benefit indirectly.
The more common scenario in practice is a dispute between you and the MCN itself — disagreement over percentage cuts, over content decisions, over account access, over exit terms. The MCN holds the local legal advantage. Their lawyers are in China. Their understanding of Chinese commercial litigation is operational. Their contracts are in Chinese under Chinese law. Yours, if you have separate counsel, isn't.
Two entities, two jurisdictions, two recourse paths.
Brand-side dispute: Ciao China is the contractual counterparty to the Chinese brand. We litigate or settle in Chinese courts on your behalf. We maintain a Chinese attorney network engaged on similar matters; cease-and-desist correspondence in Mandarin from a registered Chinese law firm has a compliance rate above 80% in our experience.
Creator-side dispute — something you have an issue with us about: you file against Ciao Canada in Canadian court, under an English-language contract, with Canadian counsel.
Our revenue depends on your revenue. If we lose your brand-side disputes, we lose our share. If we lose your trust, you exit, and we lose everything we've invested in the partnership.
Scenario 5You want to exit
Two years into the operation, you want to take everything in-house. Or switch operators. Or pause China entirely to focus on a different market. What do you take with you?
Easy to exit because the vendor only translated content. You stop their service; they stop delivering files.
You also discover what you didn't build through them. No IP layer they protected. No account base they helped grow. No brand relationships they sourced. No customer database from sales they didn't operate. The exit is fast because almost nothing exists on their side of the relationship to extract or hand over.
You're starting from scratch for whatever you do next in China.
The exit terms are whatever your MCN contract specifies, interpreted under Chinese law in Chinese courts.
Typical contract structures: the MCN keeps the accounts (because they're the registrant), or you buy them out at a valuation the MCN proposes. The translated Chinese content is theirs under work-for-hire clauses (unless you negotiated otherwise at signing, which most creators don't). Brand relationships, the customer database, supplier contacts — all on their side.
Practical effect: the audience you spent two years building belongs to them now. You can start fresh with new accounts under a new operator; the followers, the algorithmic ranking history, and the commercial pipeline stay where the MCN's team is.
Take everything.
Accounts: in your name from day one; they stay in your name. Chinese-language content: its copyright was always yours; it stays yours. Chinese subsidiary entity (if one was set up for monetization): yours; it stays yours. Brand relationships: built with you as the principal counterparty; introductions and history transfer to you or your new operator. Customer databases from any e-commerce activity: yours; they export.
Ciao China disengages on the schedule your master agreement defines. We assist with handoff to your new operator or to your in-house team. The exit terms are in your master agreement with Ciao Canada, in English, governed by Canadian law, drafted to be readable without an interpreter.
At a glance
| Path A — Localization vendor | Path B — Chinese MCN | Path C — Dual entity | |
|---|---|---|---|
| Sponsorship contracts | Limited to ~15–20% of deals that can pay offshore | MCN signs; you see what they pass through | You see gross, deduction, and net; full contract visibility |
| Account ownership | Yours in name; no operational support | MCN holds registration and operational control | Yours by registration; operated under delegated permission |
| E-commerce | You assemble 5+ separate vendors | MCN's merchant account, MCN's customer base | Storefront in your entity, operated by Ciao China |
| Disputes | You vs Chinese counterparty, alone, in Chinese courts | MCN defends what the MCN wants to defend | Brand disputes via Ciao China; with-Ciao disputes via Ciao Canada |
| Exit | Nothing meaningful to extract | MCN keeps accounts, content, relationships | Take accounts, content, customers, and brand relationships |
Why this is structured the way it is
We didn't design the dual-entity model because it was the most elegant theoretical solution. We designed it because every other configuration we tested — and we tested several — left the creator exposed somewhere across the five scenarios above. The dual entity is the minimum structure that covers all of them.
It's also the reason our compensation is zero retainer, performance-based revenue share. The model only works if you stay our partner; the model only works for us if we keep producing. The alignment isn't a value statement; it's a structural property of how the entities are set up.