Legal Briefing - Retail Compliance - Fourth Quarter 2020

In this quarter's briefing we focus on Retail in China and write about Legal Aspects and Best Practices for Retailers in China and China's Strict Rules on Advertising: Foreign Companies Be Prepared.

China Continues to Enforce Compliance in Advertisements

3 November 2020
In recent weeks, Shanghai’s market supervision bureau (AMR) announced that it has penalized one of China’s leading domestic dairy companies, Bright Dairy & Food Co., Ltd., for an advertisement video on its website that did not show China’s “complete and correct territory” of China.

Legal Briefing - Compliance - Third Quarter 2020

We are pleased to deliver you a new edition of our legal briefing. This quarter we focus on compliance and have selected a few important articles on China Social Credit System and Strategies for Dealing with Legal Compliance. We also include a letter marking the 10th anniversary of our firm.

China’s Company Chop System and Risks to Foreign Investors

Since June 2020, a fight over the control of the China subsidiary of ARM, a leading semiconductor company, has centered around the possession of the company chop. ARM was reported to have fired its head of China, Allen Wu, who is still registered as the legal representative of ARM China. With control over the company chop and business licenses, Wu would seem to have a powerful weapon to use as a bargaining chip with ARM’s shareholders outside of China, even though there is no doubt he will eventually be removed from his position. How can physical possession of the company chop cause so much trouble for ARM’s shareholders?

New Policies Impacting how Non-resident Companies Employ Beijing Staff

19 August 2020
Many international companies in China are based in one city, but may need to have employees based in another city. These employees will generally want social security in the place where they live and work, as this gives them crucial benefits in regard to medical care, schooling and housing. However, only locally-registered companies can make payments of social security premiums.

The New Social Credit System - Corporate Compliance in China

24 June 2020
While some may continue to see China as a country where “anything is possible”, there is no denying that the Chinese government has been trying to create a more compliant business environment. The initiative with the biggest impact long-term may well be the introduction of a social credit system (SCS): every entity in China will be assigned a social credit score to reflect its legal compliance.

SPC Issues Guiding Opinions on Handling Civil Disputes Involving COVID-19

On 20 April 2020, the Supreme People’s Court (SPC, China’s highest court) released the Guiding Opinions on the Proper Handling of Civil Cases Involving the Novel Coronavirus Outbreak in Accordance with the Law. Published soon after a batch of rulings issues on 24 March and 2 April, the Guiding Opinions emphasize a preference to have disputes resolved through mediation, but also reviews the conditions of the application of force majeure when handling civil cases involving the novel corona virus and the disease it causes, COVID-19.

Fiscal Support Policies in Shanghai

With the current Covid-19 crisis, governments all over the world are implementing policies to support local businesses. In China too, companies can enjoy some relief relating to taxation (incl. tax deferments and increase of export tax rebates) and social insurance contributions, while state-owned landlords are offering rent-relief. However, it is less well-known that many district […]

Environmental Assessment Risks for Manufacturers in China

24 March 2020
When our firm performs due diligence on Chinese manufacturing companies, one of the most important focal points is whether the company has passed all relevant environmental impact assessments. Many foreign investors are unaware that after a company has been formally established in China with “manufacturing” in its business scope, an environmental assessment process will usually […]

Strategies for Dealing with Legal Compliance in China

In a webinar for the Danish-Chinese Business Forum, Maarten Roos (Director of R&P China Lawyers, a China-registered law firm) shared examples and case studies on compliance issues that foreign businesses face when doing business in China, and introduced approaches on how to deal with these challenges.