Opinion: Global hedge fund managers enter Shanghai
Despite any formal announcement or regulations, the qualified domestic limited partner programme is underway in Shanghai. Hubert Tse looks at the programme and how it aligns with Shanghai’s goal of becoming a global financial centre
China question: What are some of the key things I should look at when drafting employment contracts?
I have had to switch a lot of my employees to direct hires because of the amendments to the Employment Contract Law.
A window into the future
The buzz surrounding the Free Trade Zone in Shanghai has caused foreign companies to rethink their China strategy. Should companies move into the zone immediately or wait for clearer policies to emerge?
Opinion: Roadblocks to corporate due diligence
Company records were once easy to access in China, but a series of high-profile scandals in 2012 have caused a clampdown. John Kuzmik and Xu Changrong look at how the SAIC has to strike a balance between privacy and legitimate public access to corporate records
Eight things you need to know about the new Trademark Law
It has taken three readings over two years, but the Standing Committee of the National People’s Congress has finally promulgated the long-awaited Trademark Law. Ding Xianjie and Yao Di look at the key changes and how they will affect brand owners
Secondment under scrutiny
A series of announcements on taxation have tightened the rules for multinational companies who second employees to Chinese affiliates
How companies can fight back against online defamation
An Interpretation from the Supreme People’s Court and the Supreme People’s Procuratorate got media attention because it was thought to be part of a crackdown on dissent. But it could help foreign businesses deal with the growing problem of unfair online criticism
Looking for the exit
Hu Yijin of Jun He Law Offices summarises the latest developments in private equity and analyses the implications of the IPO slowdown
The importance of IP strategy
Chen Jihong of Zhong Lun Law Firm analyses the biggest cases of the last 12 months and looks at the proposed amendments to the Trademark Law
Thinking long term
Vincent Mu of Martin Hu & Partners summarises the most important cases of the last 12 months and analyses the latest developments in the CIETAC disputes
Get ready for more enforcement
Susan Ning of King & Wood Mallesons outlines the key developments in competition law in the last year, including Qihoo 360 v Tencent, and gives some predictions for next year
Looking for new opportunities
Eric Chen of Dacheng Law Offices looks at the latest developments in the real estate sector, including the move to office property, logistics and industrial real estate
Investors look west
Yang Yuhua of Alliance J&S Law Firm provides an overview of trends in both inbound and outbound
investment and analyses the latest decisions on the controversial VIE structure
China question: What is the best way to implement a compliance programme?
I need to implement or update an anti-corruption compliance programme in my company’s China offices.
Opinion: Shanghai chooses free trade
The details of the Shanghai Free Trade Test Zone reveal that approvals and monetary flows will ease. Market participants are still waiting for clarification, but it looks like the Zone will be what the market wants and China needs
Opinion: Regulating labour dispatch
Draft provisions have clarified some of the grey areas in the Employment Contract Law and would place a strict limit on the percentage of placed workers that can be employed
An untapped resource
Mike Arruda and Joanne Du look at the development of shale gas exploration, the evolving legal regime and the process for foreign investors wishing to enter the Chinese shale gas market
Progress on privacy
New policies on data privacy come into effect on September 1. Even businesses with global policies will need to check that their guidelines comply with China’s unique take on data privacy
Courts get tough on resale price maintenance
In a high-profile case between medical supplies company Johnson & Johnson and a reseller, the Shanghai High Court held that a resale price maintenance agreement was illegal. Businesses in China need to pay close attention to the decision
A new era in antitrust enforcement
A series of high-profile investigations and actions from the NDRC has led to panic over who will be the next target. Companies need to consider how they will deal with these investigations as the authorities step up their efforts
Why Hong Kong-listed companies should look to the Cayman Islands
While takeover offers and schemes of arrangements remain useful structures for privatisations of HKSE listed companies, it may be time to consider the statutory merger process
China question: Where should I form my WFOE?
I want to form a WFOE and, while I understand there are some attractions to setting up outside the major cities, I would like to know more about the legal challenges this entails
IP Focus: Sophisticated counterfeiters and stronger enforcement
Chinese and foreign companies need to employ anti-counterfeiting strategies as actions against companies with registered intellectual property can be difficult
Opinion: IP Report shows Supreme Court’s changing attitude
The Annual IP Report from the Supreme People’s Court reveals how its stance on key issues is evolving. Owners of low quality patents may find it harder to enforce or defend their rights
Opinion: Under greater scrutiny
Draft Regulations from the State Council shows the government’s commitment to increasing regulation of foreigners employed in China
IP Focus: Issues with R&D centres
In 2000 China had 100 foreign R&D centres. That number now stands at 1600 and is set to increase. Foreign companies need to understand the IP challenges in operating a R&D centre
Indirect equity transfers cannot circumvent right of first refusal
The case between Soho China and Fosun has shown that the transfer of equity without the consent of subsidiary equity-holders evades the right of first refusal. The Judgment may pose a threat to this practice, especially in the real estate sector
Going back to basics
The establishment of a foreign-invested enterprise in mainland China can be a formidable task, but a Circular from the State Council may streamline the process and ease the registration burden
Failing to define the relevant market
The Guangdong Higher Court has ruled in favour of Tencent in its closely watched anti-monopoly case with Qihoo, but as Fang Qi points out, the Court failed to analyse the market correctly
Guiding regional investment
The revised Catalogue expands opportunities for foreign investment across the country’s regions and encourages some previously restricted areas of investment. But investors looking to move west need to be aware of the challenges that they face
What the new HKIAC Rules mean for China-related arbitration
Following extensive review and consultation, HKIAC has unveiled its much-awaited new Administered Arbitration Rules, which are attractive to mainland parties and will come into force from November 2013
China question: How do I terminate an employment contract in China?
My company is a foreign-invested enterprise, how do I ensure that when I terminate an employment contract I can avoid costly labour disputes and penalties?
Opinion: How Microsoft beat Apple in the war on warranties
Apple and Microsoft’s warranty polices have come under fire from China’s state-run media. Stan Abrams, Asia legal counsel for Bentley Systems, explains what PR lessons foreign companies can learn from the war on warranties
Opinion: Bureaucratic restructuring - power is the key
The State Council has restructured a number of the country’s ministries in an effort to boost efficiency. But as Steven Dickinson explains, the reorganisation is more focused on power and control
Why representative office placement does not work
A representative office using temporary workers is challenging and more burdensome than direct employment, as agencies in practice release all responsibility after workers have been placed. Legal reforms have not clarified the situation, which means it may be time for investors to switch to a WFOE
Going outbound: What private companies can learn from SOEs
Soaring outbound investment is generating excitement and debate across domestic as well as international economic and political spheres. Privately-owned companies have started contributing to this trend, but what can they learn from experienced state-owned enterprises?
Protecting indirect Taiwanese investors
Taiwanese businesses often invest into mainland China indirectly as it can offer them enhanced protection through bilateral agreements. But new Measures have reduced concerns and may open up opportunities for foreign investors
Foreign officials under the FCPA – a foreign concept?
The FCPA’s broad interpretation of what constitutes a foreign official includes any employee of a state-owned enterprise. Companies doing business in China need to understand the risks and uncertainties
What China’s IPO crisis means for PE investors
IPOs are the exit of choice for PE investors, but with a backlog of over 600 companies waiting to list, PE sponsors are now focusing on non-IPO exits. But how viable are these other exits and what advantages do they offer?
Clarifying corporate income tax under the VAT regime
An Announcement from the SAT finally clarifies whether VAT should be included in the tax base for withholding tax levied on non-resident enterprises
Patent boom: The cost of doing business
China has surpassed the US to be the number one patent filer in the world and its domestic companies are now filing more patents than their foreign rivals. But what effect has this had on foreign businesses and what patent strategy should they adopt to survive in this increasingly crowded market?
China question: What are the most common legal challenges when expanding a franchise?
My business is already in China, but I want to expand it from its current base in Shanghai through franchising.
Curbing damage awards in copyright infringement cases
Copyright infringement cases against Apple and Baidu have highlighted the increasing threat internet service providers are facing, but as Fang Qi points out, the damages awarded are often too high because courts do not consider market value
Opinion: Why the audit fight between regulators will hurt China
The Big Four accounting firms have ignored requests to submit auditing papers to the US Securities and Exchange Commission because it violates Chinese law, but as Paul Gillis points out, China will lose out unless a compromise is found
Opinion: Inventing the rules on service inventions
For the first time, draft Regulations on service inventions have given a procedural framework for defining and reporting inventions, but they are hampered by a lack of clarity
Building a new data protection framework
Legislation from China’s top legislator means that a nationwide legal framework for data protection could soon be a reality. Michael Tan and Sherry Duan consider the effects this will have on international companies
What the SPC’s VAM judgement means for investors
A decision by the Supreme People’s Court on the value adjustment mechanism has left investors worried, but if their intentions reflect the spirit of the mechanism the courts will still uphold their investments
Rethinking the labour dispatch model
Using labour dispatch workers is a well-established and popular model in China, but the system has been difficult to regulate effectively. The latest amendments to the Employment Contract Law are a step forward, but enforcement remains crucial
Getting serious about bribery
China’s government has unveiled a series of new measures to crack down on corruption, including a unified database of cases that could ruin a business’s reputation. Internal compliance programmes need to be strengthened and updated
Taiwan Focus: Resolving cross-strait investment disputes
The Cross-Strait Investment Agreement provides investors with greater confidence, but Taiwan and China need to work on enforcement rules to ensure dispute resolution mechanisms function
Taiwan Focus: How to comply with the Personal Information Protection Act
Taiwan’s Personal Information Protection Act has left many companies unaware of their obligations to protect employee’s personal information and how to establish their own personal information management system
Taiwan Focus: Amended Patent Act brings key changes
Many of the amendments bring Taiwan’s Patent Act in line with international practices and significantly improve patent enforcement rights
Taiwan Focus: Dismissing employees
The Labour Standards Act sets out the minimum standards for terminating employees in Taiwan. With such rigid legislation, how can employees ensure they are complying with the Act?
Taiwan Focus: Gateway to investments in greater China
Private equity and venture capital investors are seeing Taiwan as the key to entering the PRC, but PE firms have encountered difficulties with tender offers, calling for a more transparent review process and regulatory scheme
Taiwan Focus: Sourcing funds through IPOs
Since relaxing the restrictions in 2008, Taiwan’s capital markets have been inundated with IPOs, but foreign companies need to understand the proper restructuring arrangements before a formal application can be made
Taiwan Focus: M&A opportunities and challenges
Simplified procedures and tax policies account for the growing M&A transactions in Taiwan. With high expectations for an increase in PRC capital and proposed amendments to M&A legislation, this trend is bound to continue, but what transaction structures do foreign investors need to comply with?
Taiwan Focus: Interview - facilitating cross-strait investments
C Y Huang, Chairman of the Taiwan Mergers & Acquisitions and Private Equity Council (MAPE) spoke to David Tring about the Council’s role in assisting cross-strait investments, the deals they have worked on and outlook for relations
Why Chinese companies need to understand US attorney-client privilege
Chinese companies have yet to realise how attorney-client privilege could help their US litigation. As more Chinese companies go outbound, Jigang Jin explains how this powerful tool can minimise risk and save time and money
SAFE relaxes grip on forex controls
Circulars from the State Administration of Foreign Exchange have reduced the approval burden on the capital account, a move that has boosted investor confidence by showing a renewed commitment to liberalising foreign exchange controls
Opinion: Why China’s new leaders will ignore foreign investors
The end of 2012 saw China’s once-in-a-decade power transition. Professor Connie Carter looks at the challenges the new leaders face and how foreign investors will be sidelined
Reconsidering arbitration in China
While attention in 2012 focused on the controversial divisions between CIETAC and its sub-commissions in Shanghai and Shenzhen, there have been a number of more positive developments affecting the outlook for arbitration in China
Will the 12th Five-year Plan live up to its goals?
As the 12th Five-year Plan reaches the halfway mark, how close is the country to achieving the goals it set? Progress has been made in offering incentives and subsides, but key legislation that investors are looking for has yet to be passed
China question: How can I use letters of credit with Chinese suppliers?
I am a buyer and realise that most transactions with China suppliers are done through bank transfers, but I would like to know how to use letters of credit, as I have heard they can better protect me
Investing using insurance proceeds
During the last two years, the China Insurance Regulatory Commission has issued several new policies for insurance proceeds investment, but the distribution is unclear at this stage, leaving insurance companies seeking guidance