If you are a foreigner working for a domestic startup, you simply aren’t allowed to have equity. If the company is already listed or is a foreign company, then no problem, otherwise it simply isn’t allowed.
Any promise of an option through a proxy subsidiary, variable interest entity for a non listed company is not legal under the republic's law.
On other hand, a right-away stock transfer is fully legit.
If they sell a part of the stock to a listing aggregation vessel, you can have a part of this vessel's share.
Though, I keep myself a kilometer away from any financial scheme in China, and advise you do the same.
The idea that "any financial scheme" in China is worse than a "financial scheme" anywhere else doesn't make sense.
Do you want to be "entangled into opaque financial schemes" in the US as a native?
If something "goes wrong", do you want to rely on the legal system?
You should avoid bad investments everywhere.
In China, there is nothing but "bad investments", the stock market is insider trader heavy, the real estate market is bonkers, the shadow banking market...which your bank, even if it is ICBC, will actively try to sell you on, is really dodgy. Then there are crowd sourced micro finance platforms that are basically Ponzi schemes...heck, bitcoin looks like a great safe transparent investment in comparison.
Also, a western buddy of mine co-runs a VC fund. Many of the China based start-ups have western equity holders. Something is missing here.
This can't be true since you can have equity in a company. Start-up or not. An IPO may be a different thing because a regular foreigner can't hold A-Shares. If (big if) he holds a Chinese green card then even this is allowed.
I thought the whole point of the equity restriction is that you can’t hold A shares. What other kind of equity class is there besides outright ownership? And thats not even getting into the Huawei mess.