By Srinivas Raman
The recent ruling by a Chinese court in a trademark infringement dispute concerning New Balance’s logo marks a watershed moment in China’s intellectual property rights (IPR) regime.
The court awarded a landmark decision in favor of New Balance (NB) against Chinese competitors deemed to have infringed the company’s IPR, reflecting China’s recent efforts to improve IPR protection.
While foreign firms doing business in China may breathe a sigh of relief at this decision, they must also recognize the implications of the decision against the backdrop of the Chinese trademark regime.
US requests China not to implement Cybersecurity Law
The US has requested China not to implement its controversial new Cybersecurity Law, according to a document published by the World Trade Organization (WTO) on September 26. Many foreign governments and business organizations have also expressed unease at the law, in force since June 1 this year, due to its data localization provisions, restrictions on the cross-border flow of information, and government security reviews.
While the Cyberspace Administration of China (CAC) did not delay implementation of the law, it gave businesses a grace period lasting until December 31, 2018 to comply with the cross-border data flow requirements.
By Dezan Shira & Associates
Editor: Jake Liddle
As Asia’s largest economy, China has an established history of serving as the main operational center for many multinational companies’ (MNCs) operations in Asia. Since its economic reform and opening up in the late 1970s, the country started to operate and compete on free market principles, and consequently, more and more MNCs have been able to use China as an operations base.
Since then, the country has continued to liberalize and has developed its infrastructure significantly, easing and facilitating more trade and commerce as a result. With this, China has shifted its focus from being largely dependent on manufacturing, to a more service-based economy.
This means that China’s labor force is becoming more service-oriented, and education levels have followed suit. As of 2015, there was an estimated 32,000 university graduates who specialized in HR management.
By Dezan Shira & Associates
With the completion of China’s value-added tax (VAT) reform last year, VAT has almost completely replaced business tax to become the country’s main principal tax. Expanding VAT to all industries is part of the government’s campaign to streamline China’s complex tax system, encourage the growth of the services industry, and reduce corporate tax burdens.
According to the Ministry of Finance, from May 2016 to June 2017 the VAT reform had already saved companies over RMB 850 billion (about US$127.96 billion) in taxes.
Acquiring VAT general taxpayer status is essential for companies to benefit from the VAT reform’s tax reductions. VAT general taxpayer status allows companies to claim VAT credit and refunds and to issue VAT fapiao – a de facto requirement for doing business in China.
By Dezan Shira & Associates
Editor: Grace Tate
In China, companies seeking to engage in the online retail industry are required to first set up a company and a physical store. For investors not yet fully prepared for setting up a company in China, global sites launched by China’s local e-commerce platforms might be the best choice to sell to China’s lucrative market.
Tmall, China’s largest B2C platform owned by e-commerce conglomerate Alibaba Group Holdings Ltd., controls over 50 percent of China’s B2C market share. In 2013, Tmall launched Tmall Global: a cross-border, online platform that allows international brands and retailers to sell directly to Chinese consumers without having a physical presence in China.
By Gidon Gautel
Social insurance exemption for foreigners can be a valuable asset for employers and foreign employees to save on unnecessary costs. However, many companies hiring eligible employees are not aware of the benefits available to them, while those who do are often unsure as to how to go about applying.
China’s social security system consists of five different types of insurance, plus one mandatory housing fund. The five “insurances” are pension, medical, work-related injury, unemployment, and maternity insurances, while housing fund contributions are included because the costs come from both the employer and the employee.
Market for e-cigarettes grows as tobacco regulations tighten
China accounts for 45 percent of all cigarettes consumed globally. The statistic appears to be one that officials are interested in curbing: the government raised taxes on cigarettes from five to 11 percent in 2015, further banned foreign investment in the tobacco industry in 2016, and following a number of citywide bans, a countrywide ban on smoking indoors will take effect later this year.
Many industry observers expected these reforms to encourage the use tobacco cessation products, such as e-cigarettes (commonly referred to as vaporizers or “vapes”). Indeed, a pharmacist in China invented e-cigarettes in 2003, while an estimated 90 percent of the world’s e-cigarettes are made in the southern city of Shenzhen. The vast majority of these e-cigarettes are exported abroad, but the domestic market for e-cigarettes is now growing.
By Yiyi Shi
China has numerous ports along its eastern and southern coasts – 158 in total. While Shanghai often steals the attention as the largest port in China (and the busiest in the world), there are a number of other locations that foreign traders can look into. Moreover, as ports vary in size, accessibility, growth, and preferential policies, different options may better suit different needs.
Using our Ports Index – a metric focused on size, growth, and financials – we evaluate and rank 16 of China’s top ports in this article. Additionally, we make predictions about how China’s ports may develop in the future and what investors can expect.