A few weeks ago, one of the lawyers in my office, emailed me an article co-written by a law school friend of hers. The article was on trademark infringement in the clothing industry and on what clothing companies/fashion companies should do to protect their China trademarks, written by Yujing Shu and Hai-Ching Yang of KLGates. The note with the… Continue Reading
Category Archives: Basics of China Business Law
Subscribe to Basics of China Business Law RSS FeedYour China Contract Should Be In Chinese. Here’s Why.
Posted in Basics of China Business Law, Legal NewsIt is widely believed by American lawyers that their clients should do whatever they can to avoid finding themselves in a Chinese court. This widespread belief is usually wrong. It is usually wrong because most of the time it is the American company that will want to sue the Chinese company, not vice-versa. That being… Continue Reading
China Non-Competes. The Basics Have Become Clearer.
Posted in Basics of China Business Law, Legal NewsEarlier this year, China’s Supreme People’s Court of China promulgated various interpretations of various employment law issues. These interpretations were intended to clarify and for the most part, they did. In particular, what was once unclear about non-competes signed by China employees has now become much clearer. I am not going to compare the old… Continue Reading
The Three Rules For Your China Contract
Posted in Basics of China Business Law, Legal NewsIn several recent posts (see here and here), I have stressed that written contracts are the key to the next wave of doing business in China. I mentioned that relying on written contracts now makes sense in China because of the major improvements in the legal system that have been implemented in China over the past… Continue Reading
A Legal Checklist For Doing Business In China
Posted in Basics of China Business Law, Legal NewsClients, potential clients and/or the press are always asking me what foreign companies doing business in China need to know to stay out of legal trouble. My initial response is usually just a sigh. Since a client recently asked me to speak at his company about the legal issues of which it should be aware,… Continue Reading
How To Start A Business In China. The Minimum Capital Requirements For A WFOE, Part II — The Goldilocks Rule
Posted in Basics of China Business Law, Legal NewsCompanies seeking to form a WFOE in China are often confused about Chinese law regarding the minimum registered capital requirements for forming a WFOE. Part of the confusion stems from disreputable entity formation companies that encourage their hiring by claiming they know exactly how much will be required and that they have the ability to… Continue Reading
How To Terminate China Employees. Oh, And Be Sure To Pay Them.
Posted in Basics of China Business Law, Legal NewsThough Western companies getting tripped up in China due to differences in legal systems makes for common fodder on this blog, in the employment law context the reverse often holds true. Far too often my law firm gets contacted by companies in trouble for either assuming China’s labor laws are completely different from the West’s… Continue Reading
The New Role Of Written Contracts For Product Purchases In China
Posted in Basics of China Business Law, China Business, Legal NewsProduct manufacturing in China’s coastal regions has become increasingly challenging for manufacturers and buyers alike. Costs such as wages and rent have risen dramatically over the past five years at the same time that the economies of major buyers have suffered severe setbacks. This has put tremendous pressure on the small and medium businesses that… Continue Reading
Register Your China Trademark Or Go Home, Part II.
Posted in Basics of China Business Law, Legal NewsLate last week, we did a post, Register Your China Trademark Or Go Home, screaming about the importance of foreign companies that do business in or with China (including those foreign companies that do nothing more than have their products made in China) registering their trademarks in China. That post was in response to “East Asia Company”… Continue Reading
Silly Rabbit, The Chinese Language Contract Is What Matters
Posted in Basics of China Business Law, Legal NewsOne of my favorite “trix” employed against American companies doing business in China is the dual language contract, where the English language version is silent on which language controls. We often see this from companies that come to us for the first time with a contractual problem. Dual language contracts can be incredibly dangerous. If… Continue Reading
Ten Must-Dos For Successful China Product Manufacturing
Posted in Basics of China Business Law, Legal NewsA reader directed me to an excellent article in Material Handling & Logistics Magazine, setting out the basics for succeeding at outsourcing product manufacturing to China. The article is by Michael Zakkour of Technomic and it is called The Ten Rules for Contract Manufacturing in China. The article starts out by noting that “there are three… Continue Reading
China Legal. Not Hong Kong Legal. Not Taiwan Legal. Not Macau Legal.
Posted in Basics of China Business LawI have given four China law speeches in the last month (two live and two via webinars, here and here). Three out of the four talks generated questions as to whether what I had said applied to Hong Kong or to Taiwan. My answer in all instances was a resounding “no.” Mainland China has its own… Continue Reading
China Product Problems. Again.
Posted in Basics of China Business Law, Legal NewsI’ve been deleting old emails today and in doing so I have deleted far too many that relate to China product quality problems. Here’s the most recent such email, with all identifiers removed to protect the victim: My company purchased hundreds of _____ from a company in China for about $65,000. Most of these _______ were… Continue Reading
The China MOU (Memorandum of Understanding). Use Them At YOUR Peril.
Posted in Basics of China Business Law, Legal NewsThe other day, Steve and I were emailing with a reporter regarding on how Memoranda of Understanding, commonly called an MOU, are so different in China than in the United States and how that difference often causes early discord between Chinese and American companies. Steve started the discussion by talking about the differences in the… Continue Reading
First Question For Doing Business In China: Is It Legal?
Posted in Basics of China Business Law, China BusinessA couple weeks back, I co-moderated a Doing Business in China seminar at which two lawyers speakers went through the steps for forming a China WFOE. My two cent contribution was on the need to make sure that what you are planning on doing in China is legal, and to do that before anything else…. Continue Reading
China Non Disclosure Agreements (NDA). Done ALL The Time.
Posted in Basics of China Business Law, Legal NewsJust responded to an email from a client that went something like this: A couple of the potential manufacturers to whom we are showing the NDA you did for us are saying that “we don’t respect” them and that these sorts of agreements are “not done in China” in the _____ industry. Is this true?… Continue Reading
Why What You Are Reading On China Law Is Probably WRONG.
Posted in Basics of China Business Law, Legal NewsIf I had to list just one thing I love about being an international lawyer, I would answer by saying the uncertainty/ever changing nature of my job. And with China, those things are on steroids. About a third of the time when I am out speaking on China, someone in the audience (usually near the… Continue Reading
China Trademarks. Doing Them With Class.
Posted in Basics of China Business Law, Legal NewsAs we have written many times over the years, if you are selling goods into China, sourcing goods from China, or even just doing business in China or with China, you probably should be registering a trademark in China for your logos and brand names. China is a first-to-file country and it requires no evidence… Continue Reading
China Trademark Basics. I Have My China Trademark, Now What?
Posted in Basics of China Business Law, Legal NewsThis is Part II to all the posts we have written stressing the importance of registering your trademarks in China, including the following: File Your Trademark In China. Now. China: Do Just One Thing. Trademarks. China’s Changing Trademark Environment. Why You Need To Register Your Trademark Now. WHEN To Register Your China Trademark. A client… Continue Reading
China Contracts. Watching The Jurisdictional Sausage Get Made.
Posted in Basics of China Business Law, Legal NewsAs I am always saying, I love it when my blog posts come pre-written. Today I was cc’ed on an email from my co-blogger, Steve Dickinson. Steve’s email was to another lawyer in our firm who had proposed writing a contract that would give our client the choice of suing its Chinese counter-party in either… Continue Reading
China Business Scams And How To Avoid Them
Posted in Basics of China Business LawIt is becoming increasingly easy to blame the “victim” of China business disasters. In my experience, when bad things happen to good people who do business in China, it is nearly always the “good” person’s fault. Like many lawyers who work with China, I have a ready set of horror stories to illustrate this phenomenon:… Continue Reading
Selling Your Product To China Through A Distributor. Just The Basics.
Posted in Basics of China Business Law, Legal NewsMy law firm has probably written more product distribution agreements in the last year than in the three years proceeding. There are two main reasons for this. First, China’s increasing wealth (despite the slowdown) directly translates to increasing demand for quality foreign product. Second, we are dealing with a “second wave” of foreign companies, not… Continue Reading
China NDAs/NNN Agreements. What You/We Need To Know.
Posted in Basics of China Business Law, Legal NewsProbably 99% of the Non Disclosure Agreements we see that have been used “quickly” by American companies with their potential Chinese counter-parties are defective, usually terminally so. One of the things that most frequently makes them defective is that they call for disputes to be resolved in the United States. The problem with that is… Continue Reading
Chinese Contracts. Because They Really Do Make A Huge Difference.
Posted in Basics of China Business LawRenaud Anjoran left the following interesting question on the China Law Blog LinkedIn Group this morning: What is the value of the Chinese Court System? I have been reading Dan and Steve’s China Law Blog for a while. They keep asserting the value of legally binding contracts, and note how good Chinese courts are at… Continue Reading
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