Can you create a website in Chinese and sell in China without government approval?
Yes, totally. As long as you host your website outside China, language doesn ‘t matter.
Then if you want something like a .cn domain name or a proper host in a Chinese data center, you will have to go through the registration process which includes signing papers in a dedicated police office, giving all details about your company and activities, provide the ID of a person in charge, etc.) Miibeian.gov.cn
Another thing is that if you want to sell things in China, most of Chinese people use 支付宝 Alipay (from Alibaba). So you will have to open an Alipay account which is not possible for foreigners within the Mainland. You can find some companies that provides gateway though.
This text was originally published in quora.