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Event Recap - Establishing the Right Entity and Maintaining the Right Legal Compliance in China

09 May 2017

The next event in our SME Briefing Series welcomed Tim Lyons, Director and Managing Partner of ManageChina, a Shanghai based consultancy firm, and focused on how to set up a business entity in China and maintaining the right legal compliance.

Tim’s presentation provided insight into the challenges and opportunities involved in setting up in China, drawing attention to a number of key issues for businesses. These include consideration of what type of corporate entity you establish (representative offices, wholly foreign owned enterprises, joint ventures, etc.); Chinese labour law and the employment of locals; employment of foreigners and visa requirements; IP protection; and cybersecurity law.

China’s cybersecurity law was adopted in November 2016 and will come into effect on 1 June 2017. The law will ‘regulate all network services and activities within China, including construction, operation, maintenance, and usage of networks’. An important take away from Tim’s presentation was the need to be aware of the issue of data localisation, with regulators tending towards harsher enforcement for organisations with their servers and data stored overseas.

Another key piece of advice related to the importance of understanding the legal bearing of issues such as IP and cybersecurity in China. Companies should always be up to date with Chinese laws in order to protect themselves. 

Tim concluded by emphasising that there are many laws and regulations in China, with variation across the country. Businesses need to be ready to comply with local regulations and avoid shortcuts. Further, common sense used in Australia is still very much relevant when going in to China. A great deal of Australian working knowledge can form a strong foundation when planning a China strategy.

ACBC Victoria warmly thanks Tim for sharing his knowledge and expertise and kindly thank all those who attended this informative event.