File a lawsuit in China: begin with the right claims

This is a good lesson to be learned by legal professionals in China, and foreign law firms and lawyers instituting arbitration proceeding in China shall also bear this in mind.

Here is the true story: a seller and a buyer entered into a trademark transfer agreement pursuant to which the seller agrees to sell a trademark (the “Mark A“) to the buyer.…

Dispute resolution where international lawyers may be weak in China

International law firms and lawyers are thriving in China for long. Foreign investors generally come into China hand in hand with a foreign law firm.

International law firms are appealing to foreign investors in China for various reasons: feeling more bonded with each other due to language skills and culture, having global connections and resources to serve…

Pitfall for buyers of Chinese trademarks

Here is the story:

A foreign investor wishes to buy a Chinese local brand in respect of certain products falling within Class A, and at the time of executing the trademark transfer agreement, the seller doesn’t disclose that he has a very similar trademark in Class B products which are similar products with those in Class A. After partial payment of the …

When does buyer become shareholder in a Chinese company when buying its shares?

To many, it may seem a simple and even stupid question. But it is not.

I   In the Case of Domestic Company

In a country with the tradition of statute laws, when a statute law fails to offer a clear answer to a certain legal issue, it can be a problem in practice.

With respect to the captioned question, China Company Law does not provide clearly for when a buyer of the …

China’s inflation slides to 5-year low

Low Inflation Rate

According to the National Bureau of Statistics, China’s inflation rate slides to 5-year lowest in September.

Meanwhile, the producer price index, a measure of inflation at the factory gate, fell 1.8 percent last month, after slipping 1.2 percent in August. In this month, the consumer price index increased only 1.6% year-on-year, which…

What if your real property in China is sold by an unauthorized person?

It happens not only in China. There seem to be property scam all over the world, click here and here.

A recent case intrigues me a lot.

Facts: an old Shanghai lady who become an American citizen back in 1990s left her apartment in down town area of Shanghai to her niece for use and care. Recently when she came back to Shanghai, she found that her apartment was now owned…

broadcasting right for sport events in China

I have been serving as external legal counsel for SlamBall China for a couple of years. With its rapid growth and expansion, it has attracted more and more media attention. In this November, it will hold a SlamBall tournament in Wuhan and Beijing, a big event for SlamBall China and for the sport itself.

Here comes an internet company with interest to broadcast …

Allocated land use right issue in purchasing properties in French Concession Area in Shanghai

This is actually a summary written to one of my clients who is selling his house in the French Concession Area in Shanghai. One of his prospective buyers raised a good question regarding the land use right after reviewing the title deed of the house. Unlike other new apartments, my client’s title deed of his house does not specify a 70 year period of land use…

Can the landlord enforce a lease contract under Chinese laws?

Leasing is a commonplace type of real estate deals in the market. There are many kinds of leases, apartment lease, factory lease and office lease etc.  Serviced offices are regarded as a type of lease with special features.

Landlords always have the same headaches of tenants terminating the lease prematurely. For serviced office providers, this headache…

Obtain a security interest (guarantee) from a Chinese company

In business world, security is critical. For creditors like traditional banking lenders or industrial companies that are occasionally involved in lending, borrowing or other obligations, a security interest in the form of collateral, guarantee, standby letter of credit is always craved if ever available.

A security interest in this post refers to any  …

Is it a good time to buy property in Shanghai China?

You may say it is crazy to buy Chinese properties esp those first-tiered cities like Shanghai, Beijing, where the expectation of price drop just seems to take hold.  Probably people should wait for some time before the market gets clear where it will be going.

Not everybody has that patience.

According to a Wall Street Journal article “China buzzards

Registered capital, the greater, the better? Not really!

With China adopting the full authorized capitalization regime in its Company Law (click here for more about China reform on company’s registered capital), there has been a clear trend in the market that companies present a much bigger amount of the registered capital to the public (now through the corporate information registration and publishing…

A small tip for tenants in leasing disputes: don’t forget to send termination notice

I have been helping a client dealing constantly with lease disputes. I found that due to lack of basic legal knowledge, tenants can find themselves in very unfavorable position.

A typical scenario is like this: in the course of leasing, the tenant decides to cancel the lease and therefor refuses to pay rent and finally may move out of the leased office or residence.…

Prohibited and limited sectors in China for foreigners

Prohibited and limited sectors in China for foreigners

The 12th Five-Year Chinese Plan covering the years 2011-2015 aims to further forge relationships with foreign companies.

Although its plan is promising for the development of China, foreigners keep in mind that many economic sectors are prohibited or restricted from entering. Regularly, the Chinese…

What impact for the Shanghai Free Trade Zone in China economy?

The State Council passed a comprehensive plan to set up a free trade experiment zone in Shanghai on August 26, 2013 [see our analysis of the New Rules for Commercial Factoring in Shanghai Free Trade Zone] . Few months later, how to evaluate the real impact of Shanghai pilot FTZ in China ?

The Shanghai FTZ is made up of three extant bonded areas – Yangshan, Waigaoqiao…

Who the hell has the right to represent a company in China?

This is a true story.  The question here may well boggle minds of fellow professionals in China.

I. Facts of the Case

A foreign investor has set up a wholly foreign owned enterprise (“WFOE“) in Shanghai, a limited liability company. The WFOE has a board of directors with three members, and one supervisor. One of the board member, a foreigner, was…

Commercial factoring business in China Free Trade Zone to take off

[You may wish to download a PDF version of this post, click New Rules for Commercial Factoring in Shanghai Free Trade Zone_140604.]

New and detailed rules regarding special treatments for certain industries in China (Shanghai) Pilot Free Trade Zone (the “Shanghai FTZ“) have erupted recently covering quite a number of sectors that may otherwise…

Derivative Action/lawsuit in China: protection of (small) shareholders

[You can also download the PDF version for review here Derivative Action_140516]

Derivative actions are regarded worldwide as an effective enhancement of corporate governance in terms of protecting shareholders from the misbehaving management of their invested company, and protecting small shareholder from being repressed by controlling shareholders.…

Case study on legal representative: a good lesson on corporate governance of companies in China

This is a true case that I am handling.

FACTS:

A European investor set up a wholly foreign-owned trading company in Shanghai, China as its foothold in China to sell its advanced products. The shareholder appointed three members on the board of directors who are all foreigners with no regular residence in China. One of the director was appointed to serve as the …

Appoint a Chinese lawyer as supervisor for your company in China

I am still working on behalf of a European corporate client to clean up the mess of its invested WFOE in Shanghai caused by the WFOE’s general manager and legal representative.

The WFOE has a board of directors and a supervisor as well. The management of the WFOE is left to a general manager who also serves as the legal representative of the WFOE. It seemed …