China lawyers
Because of this blog, our China lawyers get a fairly steady stream of China law questions from readers, mostly via emails but occasionally via blog comments or phone calls as well. If we were to conduct research on all the questions we get asked and then comprehensively answer them, we would become overwhelmed. So we usually provide a quick general answer and, when it is easy to do so, a link or two to a blog post that provides some additional guidance. We figure we might as well post some of these on here as well, which we generally do on Fridays, like today.

Let me begin this post by saying that I am a perpetual optimist. Ask people who know me well and I’m sure they will back me up. I’m not just the kind of person who views a glass half full, I will immediately tell you why this half-fullness is such a great thing and how all we need to do to get the glass entirely full is to do XY and Z. My optimism is so “bad” that I have to fight against it. If someone has cancer, my first instinct is that “we’ll fight it and win and so I’m not even going to worry about it.” I’m tempted to say something like that but I’ve learned that nobody wants a lawyer (and not a doctor) saying something like that, so I don’t. But I have once or twice when been told that someone with cancer is “pretty much out of the woods” said, that’s great but I knew that would happen. That gets me weird looks. Not claiming to be scientific here, but that is how I’ve always thought about life.

I mention all this to explain my pessimism about United States-China relations. Optimism and hope are great but as a lawyer tasked with representing companies that put livelihoods and financial returns on the line, I am not retained and paid to give advice intended to make people feel better or to condone proposals I do not believe will work. I am retained to give the facts and the laws and my opinions based on an objective analysis of those facts and laws. I am not retained to make people feel better or to condone actions I do not believe will work. I am retained to find solutions or when there are no solutions to be clear about that as well. Believe it or not, we would much prefer to get fired for telling the truth about a client proposal we know will not work than to just go along with it and hurt our reputation and our integrity by encouraging a sure failure. The great majority of lawyers I know act likewise.

This is all my preface to today’s question. Our China lawyers and our international trade lawyers are constantly getting asked, “what next for US-China trade?”

My response is that I see the United States and China continuing to decouple. I see this because both the United States and Chinese governments want this for the long term and everything you see that looks like things are otherwise are just short term solutions to forestall possible economic problems. So for instance, when someone says, “how can you say greater decoupling is inevitable when the United States and China are right now on the verge of reaching agreement on at least some of the disputed issues?”

I can say this because whatever “baby” agreement is reached will focus on the pure trade or economic issues. They will not resolve the deeper issues, such as China’s intellectual property theft, China’s closed market for foreign companies, and China’s subsidies for its own companies. Most importantly, they will not resolve the United States’ issues with China’s handling of Hong Kong, Xinjang, Tibet, Taiwan and the South China Sea. To see where things are going with US-China relations stop focusing on the little issues like the amount of agricultural products China will buy from the United States in the next year (especially since China is in desperate need of ag products because its own farm system is such a disaster). If you want to discern the future of US-China relations you should be reading or listening to the big picture long term pronouncements by government leaders. Reading the following will help:

The trade dispute between the United States and China entered its second year and remains mostly unresolved. The Chinese government’s unwavering commitment to state management of its economy remains a major stumbling block. In response to decades of unfair economic practices, the United States wants the Chinese government to codify commitments to strengthen intellectual property protection, prohibit forced technology transfer, and remove industrial subsidies. But these practices are core features of China’s economic system, and the Chinese government views U.S. demands as an attack on its national development.
China continues to ignore the letter and the spirit of its World Trade Organization (WTO) commitments. The resulting impasse has led to multiple rounds of mutual tariff actions impacting more than $500 billion in bilateral goods trade, and reducing trade between the two countries. In response to U.S. measures to address illegal activities of Chinese technology firms, China’s government strengthened pursuit of technological self-reliance and its state-led approach to innovation, which uses licit and illicit means to achieve its goals. This will continue to pose a threat to U.S. economic competitiveness and national security.
None of the top-tier Democratic presidential candidates have truly questioned the United States’ trade war against China and as far as I know, none have called for removing the tariffs against China. Many of spoken out even more strongly than Trump regarding China’s military and human rights practices. In other words, this decoupling is not just a Trump thing that will end if he is not re-elected.
Read the above links and if you still believe decoupling is not our fate I would welcome your explanation in the comments section below.
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Photo of Dan Harris Dan Harris

Dan is a founder of Harris Bricken, an international law firm with lawyers in Los Angeles, Portland, San Francisco, Seattle, China and Spain.

He primarily represents companies doing business in emerging market countries, having spent years building and maintaining a global, professional network. 

Dan is a founder of Harris Bricken, an international law firm with lawyers in Los Angeles, Portland, San Francisco, Seattle, China and Spain.

He primarily represents companies doing business in emerging market countries, having spent years building and maintaining a global, professional network.  His work has been as varied as securing the release of two improperly held helicopters in Papua New Guinea, setting up a legal framework to move slag from Canada to Poland’s interior, overseeing hundreds of litigation and arbitration matters in Korea, helping someone avoid terrorism charges in Japan, and seizing fish product in China to collect on a debt.

He was named as one of only three Washington State Amazing Lawyers in International Law, is AV rated by Martindale-Hubbell Law Directory (its highest rating), is rated 10.0 by AVVO.com (also its highest rating), and is a recognized SuperLawyer.

Dan is a frequent writer and public speaker on doing business in Asia and constantly travels between the United States and Asia. He most commonly speaks on China law issues and is the lead writer of the award winning China Law Blog. Forbes Magazine, Fortune Magazine, the Wall Street Journal, Investors Business Daily, Business Week, The National Law Journal, The Washington Post, The ABA Journal, The Economist, Newsweek, NPR, The New York Times and Inside Counsel have all interviewed Dan regarding various aspects of his international law practice.

Dan is licensed in Washington, Illinois, and Alaska.

In tandem with the international law team at his firm, Dan focuses on setting up/registering companies overseas (via WFOEs, Rep Offices or Joint Ventures), drafting international contracts (NDAs, OEM Agreements, licensing, distribution, etc.), protecting IP (trademarks, trade secrets, copyrights and patents), and overseeing M&A transactions.