Eight Big Mistakes To Avoid In China.

One of the favorite topics among China lawyers is the big mistakes they have seen their clients, rejected clients, and others make when trying to navigate China. The discussion usually transpires with one attorney telling the facts, with the others then giving a knowing laugh and nod and then trying to top it. Had this discussion the other day and here are my favorites from it (some are mine, some come from others:

1. ?Sophisticated U.S. company calls lawyer about setting up their publishing business in China as a WFOE. Brags about the market for their publication in China, basing that on a USD$500,000 study they just completed. U.S. lawyers asks whether they did any research on whether such a business can be conducted legally in China as a Wholly Foreign Owned Entity. Super long pause.

2. ?Sophisticated U.S. company builds factory in China and right before they are ready to take it online, they learn that they cannot import the key chemical they need for it without Chinese government approval regarding its safety. Six months later they get the approval and the factory opens.

3. ?U.S. company insists against attorney advice that it can go into a China Joint Venture without contributing anything other than just its technology. In other words, it fails to abide by the requirement that it contribute a certain amount of monetary capital. Just as its lawyer predicted, it ends up leaving China within a year while its technology stays.?

4. ?U.S. company insists against attorney advice there will be no problems in forming its WFOE in China illegally because the local government supports them 100%. Within a couple of years Beijing comes in and shuts them down.

5. ?Foreign companies (we talk about this sort of thing as a common occurrence) hires inadequate company formation firm to form its China WFOE and buys into the notion that the lower the minimum capital requirement, the better. After the China WFOE is formed and has run low on money, the home office in the United States or wherever sends an infusion of money to the China WFOE. China then taxes that money as income to the WFOE.?

6. ?U.S. company pays bribes and then gets investigated for Foreign Corrupt Practices Act violations.

7. ?U.S. company fails to register its trademark in China because it was "just" manufacturing there. Ends up getting its product blocked from leaving China by a Chinese company that registered the trademark the U.S. company was using but had not registered in China.?

8. ?U.S. company buys expensive property in big-time China city and then spends millions refurbishing it for high-end offices. Then hires lawyer to handle the legalities of raising additional funds in the United States to complete the refurbishment. Lawyer spends a few hours doing his own due diligence on the project and quickly discovers the building is zoned for hospital only.?

What are your stories from the front lines? ?

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Eight major mistakes to avoid in China.

One of the favorite among lawyers China is major errors they have seen their customers, rejected and other clients to do when you try to navigate China. The discussion is generally a lawyer tell facts with others, giving knowledge laugh and nod and then try to top it. This discussion the other day, and here are my favorites of this (and some mine, some come from others):

1 American Society of sophisticated call lawyer on the configuration of their publishing company in China as a WFOE. Vanteries market for their publication in China, based on a study of $500,000 USD they just completed.U.S. lawyers asked whether they have done research on the question of whether such an undertaking could be done legally in China as a wholly foreign owned entity .Super long break.

2 Sophisticated American company built plant in China and just before they are ready to take online, they learn that they cannot import chemical product key they need it, without the authorization of the Chinese Government's security. Six months later, they obtain approval and factory opens.

3 American company insists against the Attorney advice that things can go into a joint venture of China without other than its technology contributing. In other words, it fails to comply with the requirement that it contribute a certain amount of capital monétaire.Tout as his lawyer predicts, it ends up leaving China in the year while the rest of its technology.

4 American company insists on the fact against the advice of counsel is there is no problem in formation illegally WFOE in China, because the local Government supports 100 %.Dans years, Beijing has and stops them.

5 Foreign companies (we are talking about this kind of thing that frequent) commits the company insufficient training company to form its China WFOE and buy the notion that most minimum capital requirement, mieux.Après as China WFOE is formed and implemented low on money, the United States home desktop or anywhere where sends an infusion of money from the WFOE in China.China taxes then this money as income to the WFOE.

6 American company paying bribes and gets then investigated for violations of the Foreign Corrupt Practices Act.

7. American society fails to register his trademark in China, because he was "just" making il.Extrémités until its product to leave China has blocked by a Chinese company that has registered the trademark of American society used but had not registered in China.

8 Company American buy expensive in the town of China property big and then spending millions of reclamation for top gamme.puis offices hire lawyer to handle the legality of additional United States to complete refurbishing neuf.Avocat fundraise spends a few hours doing their own due diligence on the project and quickly discovers that the building is zoned Hospital of only.

What are your stories from the front line?

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