Happy Chinese New Year!

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Happy Chinese New Year to all our readers! The Year of the Ox is looking like a long hard slog, but next week will be full of celebrations and banquets anyway…

Against a rather sad economic backdrop, AP notes that:

    “Like the celebration of Christmas in many western countries, the weeklong Lunar New Year holiday traditionally provides a significant chunk of annual revenue for many businesses in China and other Asian countries. Now squeezed by the global economic slump, many Chinese families and companies are cutting their spending on gifts and banquets to welcome the Year of the Ox, which begins Jan. 26.”

    …THE OX: Each year in the 12-year Chinese lunar calendar, in use for more than 2,000 years, is represented by an animal. And people born in a given animal’s year are said to share its qualities — passion and cunning for the Year of the Rat, duty and persistent strength for the Year of the Ox, confidence and energy for the Year of the Horse. China and other Asian nations switched to the Western calendar in the 20th century for business and government, but the lunar calendar’s new year and autumn moon festival still are popular in China, Taiwan, Hong Kong, Vietnam, Singapore — and in Chinatowns from Sydney to New York.”

While the holiday is a traditional time for gift giving, Alexandra Wrage of Trace International points out, in The Wall Street Journal, that even gift giving needs to be done with care – especially where the Foreign Corrupt Practices Act (“FCPA” – which we noted back in 2007) is concerned:

    “At this time of year in China, that often involves hong bao, or the “red envelopes” stuffed with money traditionally given between friends, family and business partners during the Spring Festival.

    … It’s a compliance issue and it’s a cultural issue. It’s a clash of the two. You have compliance offices at headquarters, whether that’s in a Midwestern state or somewhere in Europe, being told by their local hires or their points of contact somewhere in China that there are these expectations of hong bao or gift-giving around the Lunar New Year. The knee-jerk response of the compliance monitors is “we need to stay away from elaborate gift-giving and hospitality because there’s a potential for an anti-bribery violation.”

    …In a nutshell, [under The Foreign Corrupt Practices Act] you can’t offer, promise or pay anything of value to a government official, directly or indirectly, to obtain a business advantage. Well, you’ve got two flashpoints there. The first one is “anything of value,” there’s no de minimis, and it doesn’t have to be monetary or even monetizable. It can be an exchange of favors, help getting a visa…”

So, watch out for those “monetizable” gifts! And enjoy the holiday.

One Response to “Happy Chinese New Year!”

  1. Formosa Daily » Happy Chinese New Year! Says:

    […] posted here:  Happy Chinese New Year! Tags: business-issues, china, china-business, corruption, Entertainment, Events, happy-chinese, […]

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