Federal Court Enforces Chinese Judgment Against American Company at Asiabizblog
The moral of the story is that if you claim forum non conveniens in the US, don't be surprised when the US court enforces the judgment that the Chinese party obtained in the convenien forum. Even when it's a default judgment.
Over-Promise, Under-Deliver and the realities of the Chinese Market at Silk Road International
One solid Chinese language lesson.
Manufacturing In China. Because There Are 1.3 Billion People There at China Law Blog
Apparently China's no longer just a source manufacturer. Foreign companies are now manufacturing in China to shorten their logistics lines.
Sunday, August 30, 2009
Friday, August 28, 2009
Starting an eBusiness to Service Mainland China is Not eZ
So you want to sell products to Chinese consumers over the internet. It seems simple enough. Register a domain name. Stock a warehouse with goods that your market researcher has told you the Chinese will gobble up. Setup an online payment collection system. And start shipping. If you've already got an eShop going, you could even just have it translated into Chinese and start exploiting vast market overnight. If only it were so easy...
In the latest China Legal Developments Bulletin, Baker McKenzie has a thorough article on "Internet Business Law in China for US Companies" exploring the hurdles and solutions to conducting an internet business with Chinese customers.
The most significant hurdle is China's foreign exchange regime. The authors note that the "vast majority of potential customers in China cannot or will not pay in US dollars and the Chinese currency, the Renminbi, is not freely tradable." The most onerous exchange controls have been loosened, but the company needs to have a way to accept RMB. When the RMB is remitted to the US, documentation showing that it was for permitted business purposes is required and SAFE must approve of the remittance. Some customers will have foreign exchange plastic, which will make this easier for the company.
The import taxes on goods are considerable, and are composed of the import duty, import level VAT, and consumption tax. The article notes that international courier services often offer customs clearing services for merchants.
I knew that China heavily restricted the operation of telecoms services by foreigners, but I wasn't aware of the wide array of services that fall under the telecoms umbrella. A JV is required, and foreign ownership is limited to 49% in a basic telecoms service, and 50% in a value-added service. Basic telecoms services are services that require a telecom infrastructure. The article lists the most important value-added telecoms services as
A good article with some nice jumping off points.
In the latest China Legal Developments Bulletin, Baker McKenzie has a thorough article on "Internet Business Law in China for US Companies" exploring the hurdles and solutions to conducting an internet business with Chinese customers.
The most significant hurdle is China's foreign exchange regime. The authors note that the "vast majority of potential customers in China cannot or will not pay in US dollars and the Chinese currency, the Renminbi, is not freely tradable." The most onerous exchange controls have been loosened, but the company needs to have a way to accept RMB. When the RMB is remitted to the US, documentation showing that it was for permitted business purposes is required and SAFE must approve of the remittance. Some customers will have foreign exchange plastic, which will make this easier for the company.
The import taxes on goods are considerable, and are composed of the import duty, import level VAT, and consumption tax. The article notes that international courier services often offer customs clearing services for merchants.
I knew that China heavily restricted the operation of telecoms services by foreigners, but I wasn't aware of the wide array of services that fall under the telecoms umbrella. A JV is required, and foreign ownership is limited to 49% in a basic telecoms service, and 50% in a value-added service. Basic telecoms services are services that require a telecom infrastructure. The article lists the most important value-added telecoms services as
(1) online data processing (e.g.online banking, auctions, payment processing, and back-office functions), (2) data storage services, (3) Internet information services (e.g. Internet content providers (“ICPs”)), (4) data hosting, (5) Internet access services (e.g. Internet service providers (“ISPs”)), and (6) call centers (e.g. centers providing technical or training assistance online or by telephone).Only 19 value-added services have received approval. That's not say that creative solutions have not been found. They have. The article does not discuss the success rate, but it does say that the solutions are risky, and gives an example of an early one that failed. Solutions have included renting the license of a Chinese company (which cost many foreign companies dearly when MIIT wanted them out of China Unicom's equity, yet is still seemingly popular), leasing equipment to a licensed Chinese company that provides the services on behalf of the foreign company, and establishing a Chinese entity with a business scope that includes some technology functions and then operating ultra vires. The authors suggest that the biggest threat to a company operating in these grey areas is high-profile success.
A good article with some nice jumping off points.
Monday, August 24, 2009
You Should Read This House Special Book: Brothers by Yu Hua
Wow!
If I thought it wasn't cheating to give just a one word review of the book, I wouldn't go any further. But I do, so I will.
Back in January I was listened to Fresh Air's Maureen Corrigan review Brothers by Yu Hua. She used Tom Wolfe's Bonfire of the Vanities as a reference point for the review. Wolfe is one of my favorite writers. His fiction isn't as strong as his earlier work, but I enjoy reading the fruits of his literary philosophy that modern fiction should embrace realism. So this comparison got my attention. By the end of the review Maureen said that Wolfe's own fiction was a pale imitator of his literary philosophy when compared with Yu's Brothers (the details appear to have been changed in the transcript).
She was right. No where was this more apparent than in the conclusion. Wolfe went pretty far off the deep end in the epilogues of Bonfire and A Man in Full. Charlotte Simmons was a bit more reasonable. Brothers was more satisfying in that I wasn't left scratching my head with character twists that were not in character.
But this website purports to be about China law and business, so I'm gonna step away from the literary criticism and look at what Brothers might teach us about China.
I didn't live in China during the Cultural Revolution, thus I can't illuminate my readers as to the accuracy of Yu's portrayal of it. Instead I'm going to assume that the book's overwhelmingly positive reception in China, and the governments refusal to ban it speaks to its authenticity. The only work of fiction I've read that touches on the CR is Wolf Totem. The treatment: we were students in Beijing, we got sent to Mongolia, it was pretty awesome. Not the typical CR story that the history books evoke. Brothers seemed somehow more typical, and Yu did a fine job of addressing the CR from a variety of perspectives, if not voices.
The book is worth the read for the CR story alone. But it will stick with you because of Baldy Li. Baldy is the stereotypical self-made man. He loves his brother, but I was was never convinced he didn't hold more love for his golden john. He is that troubling new man.
There is a particular passage about Baldy I wanted to include, but everyone quotes that one. Alternatively, here's a taste of Baldy:
If I thought it wasn't cheating to give just a one word review of the book, I wouldn't go any further. But I do, so I will.
Back in January I was listened to Fresh Air's Maureen Corrigan review Brothers by Yu Hua. She used Tom Wolfe's Bonfire of the Vanities as a reference point for the review. Wolfe is one of my favorite writers. His fiction isn't as strong as his earlier work, but I enjoy reading the fruits of his literary philosophy that modern fiction should embrace realism. So this comparison got my attention. By the end of the review Maureen said that Wolfe's own fiction was a pale imitator of his literary philosophy when compared with Yu's Brothers (the details appear to have been changed in the transcript).
She was right. No where was this more apparent than in the conclusion. Wolfe went pretty far off the deep end in the epilogues of Bonfire and A Man in Full. Charlotte Simmons was a bit more reasonable. Brothers was more satisfying in that I wasn't left scratching my head with character twists that were not in character.
But this website purports to be about China law and business, so I'm gonna step away from the literary criticism and look at what Brothers might teach us about China.
I didn't live in China during the Cultural Revolution, thus I can't illuminate my readers as to the accuracy of Yu's portrayal of it. Instead I'm going to assume that the book's overwhelmingly positive reception in China, and the governments refusal to ban it speaks to its authenticity. The only work of fiction I've read that touches on the CR is Wolf Totem. The treatment: we were students in Beijing, we got sent to Mongolia, it was pretty awesome. Not the typical CR story that the history books evoke. Brothers seemed somehow more typical, and Yu did a fine job of addressing the CR from a variety of perspectives, if not voices.
The book is worth the read for the CR story alone. But it will stick with you because of Baldy Li. Baldy is the stereotypical self-made man. He loves his brother, but I was was never convinced he didn't hold more love for his golden john. He is that troubling new man.
There is a particular passage about Baldy I wanted to include, but everyone quotes that one. Alternatively, here's a taste of Baldy:
The two steaming bowls of noodles were placed in front of Baldy Li, who then pointed at them with his chopsticks and asked with a smile, “Which will I eat first? The advantage of starting with the house special is that I would eat the best one first, but then I wouldn't be able to appreciate the plain one. This strategy would be one of seeking quick profits. On the other hand, if I start with the plain one followed by the house special, I would be able to appreciate the flavor of each, and furthermore they would get increasingly flavorful through the meal. This latter strategy is one of long-range ambition.If you're stuck on what book you're going to read next, I recommend that you fucking read this one first.
Baldy Li hadn't even finished his speech when he heard his fourteen loyal minions all swallow eagerly. He could see the idiots drooling and realized that if he didn't stop talking, they were likely to pounce on his noodles, so he said loudly, “I'll fucking eat the house special one first!”
Sunday, August 23, 2009
The price is….. right? M&A Valuation in China at All Roads Lead to China
Fine guest post detailing thoughts and considerations that need to go into negotiations with targets.
Rio Tinto and Urumqi as Corporate Culture Lessons at Silk Road International at Silk Road International
Pretty damn good. Lots of info for dealing with factories in particular and Chines counterparties in general.
Seven Impossible Things About Chinese Economic Data Before Breakfast at Infectious Greed
The possimpibilities of China.
Fine guest post detailing thoughts and considerations that need to go into negotiations with targets.
Rio Tinto and Urumqi as Corporate Culture Lessons at Silk Road International at Silk Road International
Pretty damn good. Lots of info for dealing with factories in particular and Chines counterparties in general.
Seven Impossible Things About Chinese Economic Data Before Breakfast at Infectious Greed
The possimpibilities of China.
Monday, August 17, 2009
What's Next? The Post-JD, Post-Bar Edition
My posting sort of petered out there for a while. I blame it on studying for the bar. I was not prepared for the tedium that is studying the black letter law of some imaginary legal jurisdiction. The studying did prepare me for writing the most boring essays I've ever written for an exam. The cleverest I let myself get was writing, "If a truck crashed on an interstate highway then it would be a literal obstruction of interstate commerce." So here's what's been happening, and what's going to happen.
In May I graduated from University of San Diego School of Law. In July I took the California Bar. Next week I begin NYU's LL.M. Graduate Tax Program.
Why tax? During my international investment course last semester it dawned on me how integral tax issues are to every aspect and every type of international investment. I like working with the tax code, the tax code is constantly changing, and it is heavy on the politics and the policy. International tax is even more fun because it at least doubles up on each of the above. Plus I like the arithmetic.
Course of study? I'm going to focus on an international tax.
Goals? Work in international tax, and focus on US-China investments.
What's this mean for the blog? You might have noticed that last Winter-Spring the blog was getting more tax heavy. I'd expect more of the same. There will still be general legal and business topics along with my attempts at avoiding domestic Chinese politics. And I might write about whatever the hell want to on the weekends.
If you're in New York, give me a holler. Especially if you know where to get some cheap tasty food.
In May I graduated from University of San Diego School of Law. In July I took the California Bar. Next week I begin NYU's LL.M. Graduate Tax Program.
Why tax? During my international investment course last semester it dawned on me how integral tax issues are to every aspect and every type of international investment. I like working with the tax code, the tax code is constantly changing, and it is heavy on the politics and the policy. International tax is even more fun because it at least doubles up on each of the above. Plus I like the arithmetic.
Course of study? I'm going to focus on an international tax.
Goals? Work in international tax, and focus on US-China investments.
What's this mean for the blog? You might have noticed that last Winter-Spring the blog was getting more tax heavy. I'd expect more of the same. There will still be general legal and business topics along with my attempts at avoiding domestic Chinese politics. And I might write about whatever the hell want to on the weekends.
If you're in New York, give me a holler. Especially if you know where to get some cheap tasty food.
Sunday, August 16, 2009
Posts of the Week 8/10 - 8/16
Well my Bar studying is way done, and my bar hangover has turned into summer laziness. Tomorrow, things change. Slowly.
5 Keys to Quality when Working with Chinese Suppliers at China Success Stories
Plus initial comments by Dan, and some more comments by Rich and Dan
China’s economic policy: A ‘Great Wall’ or Capuan complacency? at dragonbeat
The perspective is refreshing. And I will always encourage references to the campaigns of Hannibal.
Chinese Oil & Gas Deal Makers: There Is No ‘I’ in Team at Deal Journal
Chinese oil companies are using joint investments to overcome China focused xenophobia.
Three Posts on the Recent US v. China WTO Copyright Case
WTO A/V Products Case I: Don’t Try This At Home
WTO A/V Products Case II: Content Review Provisions
China Law Blog
The WTO's China Video/Media Ruling. Shedding Some Light....
5 Keys to Quality when Working with Chinese Suppliers at China Success Stories
Plus initial comments by Dan, and some more comments by Rich and Dan
China’s economic policy: A ‘Great Wall’ or Capuan complacency? at dragonbeat
The perspective is refreshing. And I will always encourage references to the campaigns of Hannibal.
Chinese Oil & Gas Deal Makers: There Is No ‘I’ in Team at Deal Journal
Chinese oil companies are using joint investments to overcome China focused xenophobia.
Three Posts on the Recent US v. China WTO Copyright Case
WTO A/V Products Case I: Don’t Try This At Home
WTO A/V Products Case II: Content Review Provisions
China Law Blog
The WTO's China Video/Media Ruling. Shedding Some Light....
Sunday, August 9, 2009
Posts of the Week: 8/3 - 8/9
Who's on First? at China Environmental Law
Info on a couple of environmental cases coming up before the Chinese courts. The plaintiff in each is the All-China Environmental Federation, what Charlie dubs a government-operated non-governmental organization (GONGO). Let's hope that acronym catches on.
China 2010: insights from Microsoft, Symbio, Lip-Bu Tan at CNReviews
Discussion on what it takes for business success in China. And see commentary at CLB.
China Property: Bubble in the Making? at China Journal
China Enhances Supervision of Cross-border Related Party Transactions at China Law Update
Property sector rebound - the view from Caijing at China Translated
China's Business Laws. Ignore Them At Your Peril. at China Law Blog
Has China Lost Control? UBS Says No at All Roads Lead to China
Info on a couple of environmental cases coming up before the Chinese courts. The plaintiff in each is the All-China Environmental Federation, what Charlie dubs a government-operated non-governmental organization (GONGO). Let's hope that acronym catches on.
China 2010: insights from Microsoft, Symbio, Lip-Bu Tan at CNReviews
Discussion on what it takes for business success in China. And see commentary at CLB.
China Property: Bubble in the Making? at China Journal
China Enhances Supervision of Cross-border Related Party Transactions at China Law Update
Property sector rebound - the view from Caijing at China Translated
China's Business Laws. Ignore Them At Your Peril. at China Law Blog
Has China Lost Control? UBS Says No at All Roads Lead to China
Monday, August 3, 2009
Posts of the Week: 7/27 - 8/2
How to Get Your Business into China. Legally at China Law Blog
Nice survey.
Many things that you know about China are wrong at free exchange
Dang facts.
Delicate China at Buttonwood
Estimate that 1/5 of all 2009 lending in China was used to buy shares on the markets.
Beijing's New Offer for Regional Headquarters at China Law Update
Beijing wants multinational regional HQs, too.
Nice survey.
Many things that you know about China are wrong at free exchange
Dang facts.
Delicate China at Buttonwood
Estimate that 1/5 of all 2009 lending in China was used to buy shares on the markets.
Beijing's New Offer for Regional Headquarters at China Law Update
Beijing wants multinational regional HQs, too.
Subscribe to:
Posts (Atom)