Posts Tagged: "doing business with china"

Near the end of her presentation Bartow asked a particularly enlightening question. If China can crackdown so thoroughly on its citizens why couldn’t they crackdown on intellectual property infringement and IP crimes? She explained: “Because it isn’t in their interest.” Bartow explained that in the Chinese view it doesn’t make sense to change their view of intellectual property rights because so many within the country are becoming wealthy as a direct result of widespread intellectual property infringement. Bartow ended by saying that as long as this is the view of intellectual property it will be difficult to attract the companies that they really want to attract.

On Friday, October 3, 2014, the University of Toledo College of Law will host a one-day seminar titled “Doing Business in China.” One of the goals of Doing Business in China is to refute myths regarding intellectual property protection in China and to provide an attorney or business person sufficient information to begin the risk assessment with respect to whether China represents a good strategic investment for a small-to-mid-size business. A highlight of the program will be a presentation on cross-cultural communication and negotiation for businesses and attorneys who will work with the Chinese counter parts with a discussing on how to avoid miscues and miscommunication.

Crocs, Inc. (NASDAQ: CROX) announced earlier today that Chinese courts have sentenced 18 individuals to a total of more than 46 years in prison for producing and selling counterfeit Crocs goods. Seventeen individuals were convicted of counterfeiting, and two of the 17 also were convicted of offering bribes. Another individual also was convicted on bribery charges in connection with production of counterfeit Crocs™ shoes. In addition to prison sentences, the above men together face fines totaling RMB 2,832,500 (approximately $450,896).

1.3 billion people simply cannot be ignored, that much is certainly true. In my experience, however, when potentially ridiculous sums of money are at issue people, including otherwise shrewd business executives, suddenly seem to lose double digit points off their IQ. Believing that you can successfully navigate the potentially treacherous waters of doing business with China without careful planning and competent, experienced counsel is simply naive.

As the second largest economy in the world, China is emerging to the center of the world’s economic stage. This emergence has been accompanied by constant changes in its legal and economic sectors. The intellectual property sector also has witnessed numerous recent changes. There have been significant new advances in China’s national innovation policies. New trends in Chinese patent filings have emerged. A growing number of Chinese companies are creating their own IP and increasingly filing infringement suits against foreign companies and their local competitors in China. China’s third patent law amendment has materially changed patent practice and procedures in that country.

Many people assume that there’s no way American manufacturers can compete with cheap Chinese labor. It’s just basic economics, right? Wrong. It’s the U.S. government’s myopic policy, not China’s lower payroll costs, that make our nation uncompetitive in the all-important solar and other high-tech manufacturing sectors. With manufacturing friendly tax policies and a permanent 20 percent R&D tax credit equal to what other nations offer China’s advantage drops to 1 to 2 percent, and that the U.S. can compete with.