China Law Blog
China Law For Business. The Business of China Law.



How To Get What You Want From The Chinese Government, Part II. Make It Win-Win. (Jul 3)
In The Subtle Art of Lobbying the Chinese Government , Alistair Nicholas of Off The Record posted on our post on how to lobby the Chinese government. Nicholas noted something very important I left out in my post. Our post focused on who to lobby and the logistics of lobbying, but it left out what to say to get the government to go along. Off The Record filled in that missing element rather well: My key learning over 20 odd years of lobbying both successfully and, sometimes, unsuccessfully across three countries are that politicians the world over are all the same. If you want them to support your cause you need to figure out what’s in it for them and offer a deal they can’t refuse. I’m not talking about delivering brown paper bags stuffed with cash or other bribes. * * * * Before you approach a politician for help you need to (with apologies to John F. Kennedy) ask not what your government can do for you but rather what you can do for your government. This is the same in...


Foreign Businesses In China And Illegality Per Se (Jul 2)
When I would judge mock trials at the University of Washington Law School. One of the things on which I always criticized the lawyers-to-be was for talking like a lawyer. I would ask if they described a guy getting out of a car as "a person descending from a vehicle" and before they started law school. Is "lawyer language" one of the reasons why everyone (except my dear mother) hates lawyers? This is my long handed way of apologizing for using Latin in the title, but I figure regular readers know I usually prefer Bob Dylan. But I digress. Knife Tricks blog has a post entitled, "Chinese Law Relating To Publishing By Foreigners: No, on my recent post on how foreign companies are allowed to operate illegally in China until the day they are not. As I said in that post: The problem with operating a business illegally in China is that past history is simply not a good indicator of future performance. We know foreign businesses that have operated illegally in China for 15 years ...


How To Get What You Want From The Chinese Government (Jul 2)
Well, within limits. Bizcult has an interesting post up on the basics of lobbying the Chinese government. The post is entitled, "How to Lobby the Chinese Government," and it is based on Scott Kennedy's book The Business of Lobbying in China. According to Kennedy, Chinese policy arises from three things: 1) bargaining between elite politicians and various bureaucracies, 2) expertise provided by intellectuals that include economists, lawyers and researchers in government-sponsored research institutes, 3) National People’s Congress legislation. To lobby effectively, you need to concentrate on these three processes and the policies they create. Lobbying by foreigners is commonly done in China and the most successful lobbyists are those who communicate and make personal visits regularly. Kennedy has the following to say about where and how to lobby: "Lobbying via Chinese trade associations can have mixed results." There are many such associations, but only some of them h...


China's New Labor Law: Results Still To Be Determined (Jun 30)
Yale Online just came out with a very thorough and objective article on China's new labor law. The article, entitled, "An Uncertain Victory for China’s Workers," is written by Lyle Morris, of China Economist Magazine. This article gives sets forth a very plausible analysis of the cost impact of the new law: Karen Lin, a senior fund manager at Paradigm Asset Management Co. in Taipei, predicts the law will add roughly 25 percent to the cost of labor in China, which typically accounts for 10 percent of total manufacturing costs. The article sees the big issues as whether workers will seek to enforce the new laws and whether courts will enforce them. Based on what I am hearing from our clients, my firm's people in China, and the Chinese lawyers with whom we work, the answer is a tentative yes to both questions. For more on China's new labor contract law, check out my last post on this topic, earlier this month, entitled, "China's New Labor Law -- Just Deal With It." That post ...


Everything You Wanted To Know About Nuclear Power In China (Jun 28)
Or "nucular," as President Bush calls it. China Comment (an excellent, relatively new blog) did a pretty amazing post, entitled, "China's Nuclear Power," detailing (and that is the right word) China's nuclear power industry. If you want to know about nuclear power in China, I recommend you read it.


Piss Off China To Please Europe (Jun 27)
Blogging for China asks a great question in its post, "Is Fiat Too Clever?" The question posed is whether Fiat used Richard Gere (of acting and T1b*t fame) in its ad to garner publicity and EU love? All seems very plausible to me, except might not Fiat's apology itself engender EU anger? What do you think? Fiat's Gere ad, marketing genius or just plain stupid?


China Real Estate. Does What Goes Around Come Around? (Jun 26)
When China's real estate market started heating up a few years ago, Beijing tightened the rules for foreigners buying property. I just read an interesting and quite convincing article, entitled, "Shrinking House Sales and the Fear of 'Deep Adjustment' Across China," the thesis of which is that the value of residential real property in China is declining and the tea leaves say it may well start tanking even more soon. I buy that. Might declining China real estate prices lead Beijing to revert back to the old rules and make it relatively easy again for foreigners to buy property in China? What do you think? Of course, nothing will happen until after the Olympics, but then what?


China's Service Sector Will Reign, Part XVII -- Pets, I Say. (Jun 26)
"Dealing with the animals was always fun, but I could no longer stand dealing with their owners." --- Explanation for retiring given to me by a retired veterinarian I know Back when we first started this blog nearly three years ago, I felt somewhat like a voice calling in the wilderness whenever we would tout how companies needed to look at China as more than just factories. Now, this idea has pretty much become common currency and so, though this is Number 17 in our series, this is the first we have done this year. The reason for bringing this series out of its quasi-retirement is that I just read a very interesting Bizcult post, entitled, "Zeroing In on the Pet Niche." The article is on "a state-of-the-art 5,000 square foot veterinary hospital with 15 staff members in Chaoyang District," Beijing. I am guessing most of this hospital's clientele (the human side anyway) are ex-pats, but the fact that such a hospital is succeeding speak volumes about what is happening in C...


On Getting Your China Cargo/Freight/Product (Jun 26)
DHL just came out with its 4th (and probably most important) volume in its "Olympics Memo And Contingency Plan." (h/t to All Roads Lead to China). This memo does an absolutely amazing job of listing out the rules and changes applicable to cargo and freight and automobiles and trucks and ports and traffic and airports and polluting factories arising out of or relating to the Olympics. And if you think all of this only matters if you are in the cargo or freight forwarding business or doing business in Beijing or running a factory in China, think again. Just about everyone who does any sort of business in China will be affected in some way by the various changes that have happened or will soon happen as China (and again, not just Beijing) gets ready. Even if you do nothing more than buy product from China, I urge you to read this memo.


China Banking: I Have Two Words For You. (Jun 25)
A year or so ago, I was talking with a good friend of mine who has a fairly high level position with one of the big American banks that has spent huge money buying into Chinese banks. I was saying I could not understand why American banks were so willing to put so much into China's banks, particularly when it would be impossible to achieve any sort of clarity regarding their bad loan risks. (Please note this was before the sub-prime mess and so I at that point actually viewed banks as generally somewhat conservative with their money). His response was, "Dan, I have two words for you: credit cards." Yes, I thought. The Shanghai Daily reports that the number of credit cards in China has nearly doubled in the past year. Nearly doubled. Had my friend been a bit more literary and succinct, he would have said, "Dan, I have one word for you: plastic. [video]"