The ever-reliable China Law Blog recently ran a post entitled “Identifying Your China Risk Factors “. The post starts by saying:
“China is in the midst of what appears to be a concerted government crackdown against foreign companies doing business in China. This has led many of our clients to ask themselves (and our China lawyers): “Are we at risk, and if so, how much risk?” Our quick answer is always “yes. Hard to say.”
The same questions have been asked around here more and more often over the past few years, and the focus of conversation has moved away from opportunity and focused on risk. That, and the changing nature of risks faced by international business in China, is one of the things that promted me to write “Risky Business in China. A Guide to Due Diligence “. As I note in the book (and in a recent LinkedIn post ):
“Fundamental political, economic and social shifts have changed the nature of the opportunities and risks for foreign businesses in China. The country has emerged as the second largest economy in the world, and as an important driver of global growth with strategic political interests in the region and beyond. Domestically China is undergoing a significant reform programme while managing a massive, urbanising population that has social media as a tool with which to express increasingly vocal aspirations and frustrations. Entrenched local interests and state-owned enterprises are not the easiest targets for the Chinese government to deal with. But well-known foreign companies that are found, under scrutiny, to be flouting the law, abusing dominant market positions, or discriminating against Chinese consumers, may be considered fair game.”
These shifting conditions require companies to shift their thinking, or risk getting lost. China Law Blog concludes that:
“If you are serious about mitigating risk with your China business in the current environment, get serious about compliance…”.
PS Dan Harris was also kind enough to highlight my book – which aims to help people recognise and mitigate the risks:
“My long-time friend Jeremy Gordon will…be coming out with a book, entitled, Risky Business in China: A Guide to Due Diligence. I have talked enough with Jeremy about his upcoming book, seen enough portions of the book, and also worked enough with Jeremy enough to be able to guarantee this will be a great book and to urge everyone to buy a copy. Amazon describes it as follows:
“Risk is a major reason that companies fail in, or fail to enter, China. This unique book demonstrates how correctly-applied due diligence can not only reduce business risk in China, but also provide excellent business intelligence to support negotiations and business relationships. Based upon the author’s twenty years of consulting experience in China, this practical book is packed with real-world case studies of failures and successes, providing a valuable and detailed ‘road map’ to avoiding the most high-profile pitfalls of business in China”.