Basics of China Business Law – Page 6

Published: February 5, 2022

Translate Your Contract For China? Not Gonna Do It

Every few months someone will write one of my law firm's China lawyers asking them to translate an already written contract for China. We always refuse, not just because we are lawyers not translators, but because doing so would be a complete waste of time because contracts that work for the United States, Europe, Australia, Canada, etc., do not work for China and putting those contracts into Chinese won't change that. Indeed, it is ridiculous to think that an American business owner could draft a contract in English and that contract would work for China.

Published: February 3, 2022

China NNN Agreements and How to Give Them Real Teeth

As I noted in my previous post on China NNN agreements, for enforcement purposes you must make sure your China NNN agreement has teeth. To understand how enforcement works under Chinese law, we need to do a little work. The first point to realize is that the standard approach for enforcing an IP contract under the common law (this is the law in the United States and the UK and most of the British world) has no application under Chinese law. In the common law system, lawyers are mostly concerned with two issues. First, the rule that disfavors liquidated damage provisions. Second, the law/equity distinction that allows only for injunctive relief when a law (damages) remedy is not available.

Published: January 25, 2022

How to Draft an Enforceable China Contract

If you want to greatly increase your chances of being able to enforce your contract with your Chinese counter-party company, you should do the below. You should do a lot more than this, both within and outside your contract, but I am limiting this post to just those things directly and nearly always necessary for enforcing a Chinese contract and its terms) Have a written contract. Have the written contract set out how disputes will be resolved and, more importantly, set forth the right forum for those disputes; Have Chinese be the official language of your contract if it is going to be enforced in China, which usually (but not always) makes sense; Have the written contract set out in excruciating detail what the Chinese company must do to comply with the contract; Set out the damages the Chinese company must pay if it fails to comply with the contract; Make sure the Chinese company signs and seals your contract.

Published: January 20, 2022 Last Modified: September 24, 2023

China Online Gaming IP

China presents a wealth of opportunities for foreign gaming companies, but (and this is true of pretty much every IP-laden industry), it also presents substantial risks. This post sets out the basics on how online gaming companies can protect their IP in China via China IP registrations. Though our law firm represents a host (sort-of-pun intended) of online gaming companies, we have been hesitant to write specifically about largely because it is not all that legally different from other industries. But because we have lately been getting emails requesting we do so, we will. Starting now.

Published: January 12, 2022

China Employee Contract Renewals

When our employer clients seek our counsel on new China employee hires, we usually (but not always) advise they use an initial fixed term of three years. We also recommend that before the initial employment term is up, they consider whether to extend the employee’s contract for a second employment term.

Published: December 28, 2021

Nonprofits in China

At the end of each calendar year, many nonprofit organizations, including nonprofits in China, start to appear more frequently on everyone’s radar. Recently I counseled a nonprofit organization that wanted to set up China operations in some way. Technically they are a U.S. not-for-profit (501(c)(6)) organization, rather than a 501(c)(3) charitable nonprofit, but I use

Published: December 19, 2021

China Dispute Resolution Clauses

There is no one size fits all solution for China dispute resolution clauses because they depend on so many factors, including, the location of the Chinese company within China, the nature of the transaction, the goals of the parties, the most likely dispute issues, the most important dispute issues, the type of dispute issues, the languages of the documents and potential witnesses, the law of the contract, and a whole host of other issues.

Doiong business in China means walking a tightrope

Published: November 29, 2021

How to Maintain Control of Your China Operations: WFOE or JV or Something Else?

How to control your China operations while avoiding China government control is critical and companies looking to do business in China need to decide what the China market means to them and what they are willing to risk. Companies looking to do business in China should decide what the China market means to them and what they are willing to risk. There is no way to entirely avoid China regulatory risk, but depending on your product or service and your company’s and owner’s risk appetites, there is always a way forward. The question of how to control your China operations is just one of many questions to ask.