Asia on the Move – Strategic Global Mobility Management in China, India & Southeast Asia

Below are key excerpts from the live panel discussion, featuring speakers Thorsten Beduhn (Rödl Germany), Martin Woerlein (Rödl India), Michael Wekezer (Rödl Vietnam), and Monica Chen (Rödl China). Below discussed highlights are excerpted and compiled by Vivian Yao (moderator of the panel discussion).

Considering the current environment with geopolitical tensions and economic policies, for instance China + 1, ASEAN trade agreement, Tarriff challenges etc. how do you see the current Status Quo and opportunities to reshape the global mobility strategies for German companies in Asia?

Martin Woerlein (Rödl India)

India has emerged as an important “plus 1” / “plus X” destination within Asia for European companies. Movement of qualified talent from India to Germany is increasing massively over past few years while for executing big projects in India, talents from other Asian countries are also often seen on short term engagements basis. It is also worthy to note that previous difficulties with Visa restrictions between China and India existed. It is expected that the EU-India FTA would be “game changer”.

Remark: as of the publication date, the EU-India FTA after 20 years negotiation, has been finally signed as a very positive sign for a big movement.

Monica Chen (Rödl China)

China+1 has been widely discussed over the years. We have seen more companies implemented “Dual Asian roles” for their senior management personnels of the Chinese entity in Asia, for various considerations. One of the major factors is the flexibility in terms of work time planning for potential tax optimization opportunity, e.g., to applicable to the “Six-year-rule” in China, etc. However, such an arrangement also requires comprehensive analysis and planning from tax and legal perspectives for both the countries that are relevant to the “Dual Asian roles”. For example, social security costs should be considered by referring to relevant social security treaties. Such change in mobility strategies makes the assignment model more complicated in cost controlling and compliance work.

Michael Wekezer (Rödl Vietnam)

The trend of China + 1 indeed results in a new international employee assignment model and is often seen as an arrangement of a key management role in China plus a 2nd role in another Asian country. We also see multiple managerial roles across ASEAN countries assigned to one employee. Vietnam sees renewed focus on infrastructure projects, frequently requiring specialist installation and building activities to be conducted by foreign contractors leading to increased temporary employee mobility requirements. It is also worthy noting the significant flow of workers/trainees from Vietnam to EU, in particular Germany. EU VN FTA is already “in full swing” for some years and provides benefits to trade in both directions.

Thorsten Beduhn (Rödl Germany)

Geopolitical tensions, stricter customs policies, and China’s “Dual Circulation” strategy are making international assignments more regulated and complex. Many German companies did or consider shifting operations to China, Vietnam, Thailand, or India etc. Global Mobility managers must develop more flexible assignment programs that account for country-specific tax, visa, and labor law requirements.

In practice, issues regarding permanent establishment risks, double taxation are becoming critical focuses

How would you see the impact on global assignment planning with the rapidly developing technology & digital transformation such as AI and data analytics transformation?

Martin Woerlein (Rödl India)

India is a clear destination for digital services sourcing, during the last 3-4 years nearly all medium sized German companies started using India as GCC location. Data protection laws are on the way, by referring to the model of GDPR. Regarding the HR and finance data of Indian operations, India local compliance in several data categories requires data storage in India, this can be a challenge for global cloud-based data concepts and needs prior planning.

Monica Chen (Rödl China)

China’s Big-Data application in tax administration and collection is very powerful and still developing rapidly with upgraded versions. The tax audit in China, unlike the regular three years tax audit in Germany, is carried out on a case-by-case basis which is usually triggered by the big-data monitoring. Irregular transactions or trends may lead to tax alerts automatically. Social security collection function is taken over by the Chinese tax authority which can be anticipated to be much stricter than before, not only for Chinese citizens but also foreigners working in China. Furthermore, China also implemented complex data security law for years and sets up high standards for cross-border data transfer, which should be noticed by mobility managers for HR documents storage and data exchange.

Michael Wekezer (Rödl Vietnam)

Vietnam maybe still behind in terms of digitalization as compared to global digitalization champions but is catching up rapidly. The new vnID app-based ID tool and interface with authorities lead to increased transparency but also challenges for non-Vietnamese users like foreign company directors, effectively leading to higher personnel based in VN requirement.

There is also a significant ongoing development of data protection legislation in Vietnam, resulting of regulation of areas relevant to global employee mobility like payroll etc. Finally, Vietnam is also developing into a major outsourcing destination for services related to digitalization such us coding, programming or training AI algorithms.

Thorsten Beduhn (Rödl Germany)

The rapid advancement of technology and digital transformation, particularly in areas like AI and data analytics, are significantly impacting global mobility planning, assignment costs, and local compliance requirements including but not limited to electronic application for A1 Certificates. There are upcoming changes from 01.01.2026 with view to electronic applications for certificates of coverages regarding third countries.

These developments require Global Mobility Managers to be more closely integrated into digital HR and compliance systems to efficiently manage country-specific requirements. The digitalization of social security processes leads to greater efficiency and transparency but also demands enhanced system integration, data quality, and compliance monitoring – especially when navigating the gap between highly digitalized regions and manually driven third countries.

How would you assess the challenges and opportunities in terms of localization such as short-term assignments increase and permanent transfer cut-down in Asian countries during recent years?

Martin Woerlein (Rödl India)

In India, for most larger international companies, there is good local management talent available, but challenges exist for smaller set ups at “start-up phase” to recruit the local talent. Starting from an already comparatively low number of full-time expatriates even before Covid time, now the trend is still even more towards “fly-in-fly-out structures” due to many factors. It is very important to analyze from day one the risk factors of such models, such as potential PE risk, double taxation or tax avoidance/disputes proceedings when the model is implemented or planned.

Monica Chen (Rödl China)

The advantages for management localization usually focus on cost-saving, better understanding of local practices and culture etc. However, international assignments still play an important role in global business, in particular for smooth global collaboration. In practice, short-term assignments are more frequently seen due to more flexibility in immigration work and easier procedures for the assignees to remain in German social security system. Yet short-term assignments sometimes may trigger higher tax risks in PE exposure due to discussions raised about economic employer determination, which would complicate shadow payroll work, tax equalization implementation, etc. Therefore, such strategy changes also brought challenges for mobility managers.

Michael Wekezer (Rödl Vietnam)

There is a wide variety of models including fly-in-fly-out (now facing challenges due to vnID requirements), local management and VN based expats depending on size of company and industry. Interesting is that we also note the increasing trend to employ expats from other SEA countries and India, e.g. in technical positions, linked to higher expat requirement for short term commissioning and installation projects.

Like in any other country, it is always recommended to prepare a complete legal and tax analysis before implementing any model.

Thorsten Beduhn (Rödl Germany)

The current trend toward a significant increase in short-term assignments and a simultaneous decline in permanent transfers of German employees to China and Southeast Asia is reshaping Global Mobility strategies. At the same time, many companies are increasingly relying on local leadership structures in countries like India (“Local Management Set-up”). These developments have substantial implications in key areas such as social security, income tax, payroll tax, immigration, and permanent establishment (PE) risks.

The rise of short-term assignments demands precise tax and social security planning, along with close monitoring to avoid PE risks and foreign tax exposure. At the same time, building local leadership in Asia—especially in India—offers opportunities to reduce costs and compliance risks, but requires investment in local HR and compliance structures. Global Mobility Managers should develop hybrid models that support both flexible international assignments and strong local setups—always aligned with the respective legal frameworks.

How would you share your experience regarding the challenges from local perspectives for moving talents from Germany to Asia such as VISA regulation, tax complexities, data security, family support, cost control etc.?

Martin Woerlein (Rödl India)

India has good availability of local talent who are willing to relocate to Europe; employee retention needs careful attention. In practice, visa application and processing times are still a significant challenge due to the German legal framework. A smooth transit journey requires careful planning as regards timelines.

Michael Wekezer (Rödl Vietnam)

In Vietnam there is PIT complexity in arrival and departure years and also issues related to salary remittance in forex subject to currency control, but both challenges can be managed if conditions are met and documented. It is important to be aware that work permits are usually issued for 2 years with complex renewal processes, which present a limitation to longer-term planning for expats. Practically, expats face language barrier challenges, as English is not widely spoken, but the young generation is catching up fast! Furthermore, infrastructure remains underdeveloped.

Monica Chen (Rödl China)

For employees assigned from Germany to work in China, over years we see the biggest challenge would be risk of double taxation, mainly due to the different interpretations of double taxation agreement by the German and Chinese tax authorities. From the perspective of the Chinese tax authority, in case where a German employee is solely hired by a Chinese employer who bears all his salary costs, all his salary income shall be subject to Chinese income tax regardless of where the employee physically works for the employer, which is to certain extent deviates from the Sino-German Double Taxation Agreement (“DTA”). Thorsten, do you agree?

Thorsten Beduhn (Rödl Germany)

When applying the DTA between Germany and China, significant discrepancies arise from the German perspective—especially in cases where a German employee enters a local employment contract with a Chinese company, e.g. for immigration purposes, but remains tax resident in Germany. In this respect, below issues shall be taken into consideration when dealing with such situation:

• Divergent interpretation of Tax Residency;
• Full taxation by China despite DTA limitations;
• Limited foreign Tax Credit in Germany

Global Mobility Managers should carefully assess whether the employee remains tax resident in Germany despite a local contract in China and whether full taxation in China is justified. To avoid double taxation, tax structures should be set up in advance to allow for clear allocation of incomes such as through split contract arrangements and contractual definitions of work locations. In cases where double taxation has already occurred, it is important to evaluate whether a correction in China is feasible or whether a mutual agreement procedure should be initiated. Close cooperation with local tax advisors in China is essential to anticipate the national interpretation of tax rules and to ensure proper documentation from the outset.

How would be anticipate the challenges and opportunities for German inbound business, namely global talents from Asian to Germany/EU?

Thorsten Beduhn (Rödl Germany)

The inbound deployment of global talent from Asia to Germany or the EU presents significant opportunities for companies in terms of internationalization, innovation, and addressing skilled labor shortages. At the same time, it involves a wide range of complex legal, tax, and administrative challenges:

First, the contract structure and set-up need carefully to be verified and depends on business need and the employee’s role and position within the company (e.g. executive, specialist, project staff), as well as the planned duration of stay. Accordingly, an assignment agreement (e.g. for projects or intra-group knowledge transfer), a local employment contract (typically for long-term stays or local talent needs) or a split contract (often used for senior executives or complex international roles) could be the legal basis.

Accordingly, an assignment agreement (e.g. for projects or intra-group knowledge transfer), a local employment contract (typically for long-term stays or local talent needs) or a split contract (often used for senior executives or complex international roles) could be the legal basis.

The potential set-up, the nature of activity and length of stay determine amongst others the appropriate visa. A business travel could be covered by a Schengen visa. However, long term assignments require for EU Blue Card or ICT Card. The right visa needs carefully to be reviewed also with view qualification and family members. In Germany, only lawyers are authorized to give the right advice.

With respect to social security coverage, the existence of a social security treaty should be checked. In the absence of a valid social security treaty, or after the maximum duration expires, full coverage under the German social security system applies (health, pension, unemployment, long-term care insurance, and accident insurance). For local contracts, full German social security contributions are mandatory.

The individual income taxation depends on double tax treaty and residence status. For shorter stays a limited tax liability may apply.

At company level potential payroll obligations might arise and employers are entitled to withheld wage tax and social security contributions. If salary is paid by a group company abroad, it must be determined whether that entity qualifies as the economic employer (§ 38 (1) Sentence 3 EStG). In such case, the German company may become liable for wage tax withholding.

Furthermore, a potential PE risk needs to be evaluated based on planned activities, duration, and disposition on offices space and premises (fixed place of business). A PE in Germany could trigger corporate income tax and trade tax liability for the foreign entity in Germany.

Success hinges on early, coordinated planning across legal, tax, and HR functions to navigate these intertwined areas, prevent pitfalls like double taxation, and ensure a compliant deployment.

Closing remark from the moderator

To conclude our discussion today, we all can agree on one powerful idea: in the dynamic environment and lively competition for talent and market share in Asia, success belongs to the companies who can turn global mobility into a source of strategic advantage and innovation. Global mobility is no longer just about dispatching talent, it’s weaving a living bridge of understanding, innovation and shared growth and success between Germany and the diverse markets in Asia.