ELAC,
In reality, I am not sure really how FAA regulations pertain to China but you are correct with some expansion:
FAR Part 1 defines the pilot-in-command as follows: "Pilot-in-command means the person who:
1. Has the final authority and responsibility for the operation and safety of the flight;
2. Has been designated as pilot-in-command before or during the flight; and
3. Holds the appropriate category, class, and type rating, if appropriate, for the conduct of the flight."
Part 91.3 expands those comments making it clear that anything that happens during the flight is the sole responsibility of the pilot-in-command.
According to the Federal Register there are only three ways a private or commercial pilot can properly log pilot-in-command time.
1. When the pilot is the sole manipulator of the controls of an aircraft for which the pilot is rated.
2. When the pilot is sole occupant of the aircraft.
3. When the pilot is acting as pilot-in-command of an aircraft for which more than one pilot is required under the regulations under which the flight is conducted.
There is a difference between who is "Designated PIC" and who is "logging PIC" as the "PIC on record" can, under his authority and the agreement of the 2 PIC's, allow the other PIC to log the time as he is the sole manipulator of the controls of the aircraft. It is really not that unusual and common practice at Chinese carriers and in fact is what they require and instruct to be logged.