“When you talk to other expats about setting up a business, one of the first things they tell you is ‘be careful,’ ” said Reza Afshar, the British founder of an e-commerce company in China that sells face masks, air purifiers and other pollution protection products. “Everyone’s got a story of someone who’s been burned in the Chinese business world.”

Mr. Afshar said he failed to to see the warning signs. The joint venture with a Chinese friend, he later discovered, was actually a fully Chinese-owned business. Mr. Afshar was listed as the minority shareholder, though he paid 70 percent of the registration costs.

As the business grew, his partner, according to Mr. Afshar, began removing himself from daily operations and then departed on a string of overseas vacations. Mr. Afshar was left to deal with clients, suppliers and employees, he said.

“It was like if we were a couple and when the baby was six months old he goes to the pub every day and then eventually runs off,” he said. Then, Mr. Afshar said, the partner threatened to sabotage the company unless he was bought out — while still receiving 50 percent of future profits.

The partner, AJ Song, described their partnership in more equitable terms, but confirmed that he used his advantages as a Chinese national to bargain hard for what he felt he deserved. “I said if he wants to end ugly, I can take it all away because all the connections are mine,” he said. “It doesn’t mean that much for me because if I want to do the same business again, I can.”

Mr. Afshar eventually sold the company and has since moved back to London. He has no plans to return. “The risk of getting played in China is just too high,” he said.

The Chinese government has tried in recent years to improve the business environment by upgrading legal protections. But critics say political connections and corruption continue to undermine the law.