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Lehman Lee & Xu, the top three Chinese commercial and leading IP law firm, has successfully assisted a Thailand Restaurant located in Beijing to solve its labor dispute with an employee recently. The employee filed a lawsuit at Beijing Labor Dispute Arbitration Commission after resignation claiming relevant payment of compensations. With the hard work and positive efforts on this case, Lehman Lee & Xu protects the client¡¯s maximum rights and interests from the judgment.

For more information about Lehman, Lee & Xu, please visit the firm¡¯s website, which is www.lehmanlaw.com.

China Culture 0 Comment November 30, 2009, 3:25 pm

Lehman, Lee & Xu Will Join Two Associations in China

Qian Zhou, November 26,2009, Beijing, China

Lehman, Lee & Xu is invited to join the two important associations: the China Association of Trade in Services and the China Petroleum and Chemical Industry Association.

The China Association of Trade in Services (CATIS) is a national non-profit social body established under the approval of the State Council, governed by the Ministry of Commerce and registered with the Ministry of Civil Affairs. Its aims are to abide by the development strategy of China service industries and trade in services, integrate resources and build a national platform for the coordination and promotion of trade in services; assist the Government in formulating and perfecting the legislation system of trade in services; promulgate the China service brands worldwide and enhance the international influence of China¡¯s services. To learn more about the association, please visit http://www.catis.org.cn/english/english/company.asp.

The China Petroleum and Chemical Industry Association focuses on China petroleum and chemical industry and the Asia-Pacific petrochemical market as well. It has an online publication CPCI, which is the network information department under CNCET (China National Chemical Economic & Technical Development Center).Further information at http://www.cpcia.org.cn/English/.
Lehman, Lee & Xu has provided counsel to many associations like the Foreign Research-based Pharmaceutical Industry Association (FRPIA), the Foreign Health Industry Manufacturer's Association, the Foreign Chemical Manufacturer's Association, the China International Franchisers Association (CIFA), and the China Chainstore and Franchise Association (CCFA). This time Lehman, Lee & Xu is invited to join the China Association of Trade in Services and the China Petroleum and Chemical Industry Association and they will cooperate in Anti-trust project and other areas.

Lehman, Lee & Xu, established in 1992, is one of the largest and most prominent law firms in China.The firm has more than 200 lawyers in offices in Beijing, Shanghai, Guangzhou and Shenzhen, along with foreign branch offices in Hong Kong, Macau, Mongolia and Chicago. All of the lawyers have vast experience in working with international or foreign law firms, and have been practicing law since the re-establishment of China's legal profession. To learn more about the firm, please visit http://www.lehmanlaw.com/....

Lehman Affairs 0 Comment November 27, 2009, 9:44 am

The internet just became a bigger place

Sam Engutsamy. November 19, 2009.

Currently, web addresses are found either fully written in Latin characters, or containing only part non-Latin aspects within the addresses. The Internet Corporation for Assigned Names and Numbers (¡°ICANN¡±), within its report titled ¡®Proposed Final Implementation Plan for IDN ccTLD Fast Track Process¡¯, released on September 30, 2009 proposed web addresses be available in non Latin characters. This proposal was accepted at ICANN¡¯s annual meeting which was held in Seoul on October 30, 2009.

It was the case, that web addresses were limited too the alphabet letters, 0 ¨C 9, and the hyphen, however the approval of the proposal means that by mid-2010 web addresses can contain characters from different languages such as Chinese, Hindi, and Korean.

According to Times Magazine, over half of the 1.6 billion internet users around the world use languages which are not based on the Latin alphabet. Therefore, such a change only makes sense and opens up the internet to those who were previously limited due to unfamiliarity with the Latin alphabet. Others that will benefit from the change include local businesses, the young, and elderly.

The ICANN announced on its website, that as of November 16, 2009, they would be accepting requests from country representatives to register new Internet extensions in non Latin alphabet.

The ICANN¡¯s report is available for download in PDF format at: http://www.icann.org/en/topics/idn/fast-track/idn-cctld-implementation-plan-30sep09-en.pdf

Articles of interest:

China Law 0 Comment November 20, 2009, 6:20 pm

Insurance Funds Can Be Invested

According to the new Insurance Law of the People¡¯s Republic of China, insurance funds can be invested in real estate industry from 1st October, 2009.

In the past, the use of insurance funds in China is restricted only to bank deposit, trading of government bonds and financial bonds and other forms of fund utilization stipulated by the State Council. However, since the last century 90's, a large number of insurance companies have begun to purchase their own property used for commercial rental and a large number of insurance funds have been used to buy shares of some real estate companies. Actually, the insurance companies have already got involved in the real estate industry. Now the changes of law make these conditions legalized.

Though it makes the area of the investment of insurance funds broader, there are also some problems requiring the attention before the government releases the "insurance company real estate investment management approach Pilot".

Lehman lawyer HaoJunbo remarks that there should be also some restrictions on the use of insurance funds invested in real estate industry. For example, according to "management approach (discussion paper)", insurance companies can invest in real estate just through the purchase of property, shares the project company, asset-backed debt investments, and real estate-related financial products. Furthermore, the proportion of the investment in real estate industry should be within reasonable limits. Both the safety and the efficiency should be considered by the government....

General 0 Comment November 20, 2009, 6:02 pm

MOC launches anti-monopoly investigation of Lotte's purchase of Times Retail

On 16th November, the Ministry of Commerce (MOC) has launched an anti-monopoly investigation of South Korea-based Lotte's purchase of Times Retail.

On 20th October, Lotte announces that it bought a 100% stake in Times Retail for HK$4.87b. However, according to the existing law in China, the purchase must get through the anti-monopoly investigation by MOC.
According to ¡®Provisions of the State Council on the Standard for Declaration of Concentration of Business Operators¡¯, the business operators shall file a report for the concentration to the Anti-trust Administration in advance if any one of the following thresholds is met:
a) the total global business revenue of last fiscal year of all business operators attending the concentration is over RMB 10 billion, as well as among which the business revenue of last fiscal year in the territory of the PRC of each of at least two business operators are over RMB 400 million;
b) the total business revenue of last fiscal year in the territory of the PRC of all business operators attending the concentration is over RMB 2 billion, as well as among which the business revenue of last fiscal year in the territory of PRC of each of at least two business operators are over RMB 400 million.

For the turnover of Times Retail were more than 4 billion Hong Kong dollars last year, an anti-monopoly investigation by MOC is inevitable. Will the MOC approve the purchase?

Lehman lawyer HaoJunbo remarks that according to the Anti-monopoly Law of the People¡¯s Republic of China, it may be assumed to be have a dominant market position where a business operator is under any of the following circumstances:
a) the relevant market share of a business operator accounts for1/2 or above in the relevant market;
b) the joint relevant market share of two business operators accounts for 2/3 or above; or
c) the joint relevant market share of three business operators accounts for 3/4 or above.
From the view of market share, this purchase will not constitute a monopoly. Lotte and Times Retail together are only 70 in China, but Wal-Mart, Carrefour, RT-Mart, etc. have already more than 100. However, according to international anti-monopoly practices, there may be a different conclusion considering about specific regions or industries.

General 0 Comment November 20, 2009, 5:20 pm

Reading the Sino-US Joint Statement

Yue Liu£¬ Nov. 19, 2009, Beijing

The visiting of American President Barack Obama to China brought a warm front to the China-U.S. relationship. The Chinese Premier Hu Jintao and the American President issued a Sino-US Joint Statement, in which both countries reached several common understanding and set out future goals. There are five key points worth analyzing.

1. Partnership
In the history of China-US diplomatic history, this is not the first time China and US have proposed to form partnership. During the Clinton Administration, U.S. and China had proposed a higher level of partnership. The Obama Administration¡¯s new proposal is a symbolic gesture of two super nations¡¯ cooperation and stable relationship in this new world power distribution. China-US relations have always been a complicated issue. The proposal in forming a new partnership is a general effort to provide a guideline to fortify and improve the two nations¡¯ diplomatic relationship. The details of cooperation have to be worked out in the future.

2. Anti-Trade Protectionism
Recently, there are some trade conflicts between China and the US caused by local protectionism relating to the two countries¡¯ different national interests. The joint statement between the two nations¡¯ leaders set the goal of opposing any forms of local trade protectionism, aimed to reduce conflicts in the China-US international trade. However, this temporary measure does not mean it will smooth all the trade conflicts in the future. Some trade conflicts are still unavoidable. The two nations still need to explore more practical solutions together.

3. Fight Global Warming
During Obama¡¯s visit, China and US took a positive step toward fighting global climate change and utilize clean energy. That is to establish the China-US Clean Energy Research Center. Both sides have reached detailed investment agreement and determined research projects. The two supper energy consuming nations forming a clean energy research center is a form advance in the environmental field and bring positive impacts to the Copenhagen Conference in December.

4. High Level Military Visits
In the China-US relationship, military conversations seem to be falling behind other aspects of cooperation, such as economic and technology. The Chinese Vice Chairman of Military Committee¡¯s visit to the US in recent time signaled the future high level military cooperation between China and the US. However, in terms of the sensitive issues such as export/import policies can not be solved in a very near future.
5. Human Rights Dialog
During the Bush administration, the two nations had dialogues in regards to human rights. But during the Obama visit, the two nations proposed detailed time frame for the human right dialog in a joint statement. This signals the positive and practical attitudes of the two countries toward solving their differences in the human rights issue. ...

Lehman Affairs 0 Comment November 20, 2009, 4:50 pm

May I suggest sea cucumber?

Yue Liu, November 17, 2009, Beijing.

Sea cucumber, a strange-looking sea animal that is not familiar to most Western cultures, is considered a delicacy in China and in other Southeast Asian Countries. According to several studies, sea cucumber not only tastes good, but is also very nutrient: high in amino acid, minerals, collagen and vitamins. Chinese people call sea cucumber ¡°Ginseng of the Sea.¡±

Because of its delicacy status in the Asian food culture and the new discovery of its nutrient values, sea cucumber became ever more popular among the customers in Asian countries. Its market price is relatively high compares to other sea foods. There are broad markets and related aquatic product industries for sea cucumbers in East and Southeast Asian countries, with the largest in China.

The sea cucumber industry has already become one of the most productive and profitable aquatic product cultivating industries in China. In 2008, the industry cultivated more than 90,000 tons of sea cucumbers and the industry-wide product value is more than 200 trillions RMB. To regulate this important profitable industry, on Nov. 17, the Sea Cucumber Branch of the China Aquatic Product Distribution and Processing Association was established. The establishment ceremony was held in the form of a sea cucumber promotion conference. Officials from the Ministry of Agriculture, the Ministry of Commerce, the General Administration of Quality Supervision, Inspection and Quarantine and the Ministry of Health were in attendance.

The officials gave speeches at the conference and the agencies promised to ensure the sea cucumber industry¡¯s products and procedures comply with the Agricultural Product Quality and Safety Law and The Law of Food Safety. The purpose of the Association is to supervise the quality and safety of the sea cucumber industry to ensure the sustainable development of the industry. It is good to know that the Chinese and Southeast Asian customers can trust the quality of the sea cucumbers in their plants.

Lehman Affairs 0 Comment November 20, 2009, 4:39 pm

Embassy services in Shandong province

If you are an American citizen in eitherJinan, or Qingdao, Shandong Province and you require assistance with notary services, the addition of pages to your passport, registration information, or any other related Embassy service questions, a vice consul from the US Embassy will be able as detailed below:

A vice consul will be at hand to offer help on Wednesday, November 25, between the hours of 09.30am, and 11.30am. This will be held in the lobby of the Shandong Hotel, located at No.2-1 Ma¡¯anshan Road, Jinan.

A vice consul will be at hand to offer help on Friday, December 4, between the hours of 12.00 noon, and 2.00pm. Details as to where this will be held, will be confirmed in the response email once you have RSVP.

Should you need any of these services performed, you should email the following information by Friday, November 20 (Jinan) and Tuesday, December 1 (Qingdao) by 5pm to amcitbeijing@state.gov.

(i) Name (as stated on the passport)¡¯
(ii) D.O.B;
(iii) Gender;
(iv) Place of birth;
(v) Social security number;
(vi) Permanent address;
(vii) Home and/or business telephone number;
(viii) Passport number;
(ix) Passport insurance, and expiration date and place of issuance

For further information, please see: http://beijing.usembassy-china.org.cn/service.html.

Lehman, Lee & Xu, has an affiliated office in Jinan. For further information please see: http://www.lehmanlaw.com/offices/jinan.html, or contact us at mail@lehmanlaw.com. ...

China News 0 Comment November 20, 2009, 11:24 am

Raising the Bar of Novelty

Sam Engutsamy, November 17, 2009.

China¡¯s most recent legislative process, which amended its Patent Law (¡°2008 Act¡±), lacked one distinctive ingredient, international conformity. The 2008 Act came around through China¡¯s own push to strengthen and enforce its own domestic intellectual property regime. To date, China¡¯s Patent Law has been amended three times; the 1992 signing of the International Patent Cooperation Treaty, the 2000 amendment (¡°2000 Act¡±) resulted through China¡¯s accession to the World Trade Organisation, and the implementation of the TRIPS agreement. The 2008 Act introduces new aspects under the Patent Law and also amends previous provisions, aligning its law with international standards.

An amendment to the 2000 Act changed novelty provisions. In order to attain protection under the law, inventions patents and utility models, are required to possess three qualities; (i) novelty; (ii) inventiveness; and (iii) practical applicability. Under Article 22 of the 2000 Act, the novelty requirement would be satisfied if the invention or utility model in question had not been publicised anywhere in the world or used within China before the application filing date.

However, adjustments under the 2008 Act revises Article 22 and now promotes a global test of novelty whereby should an invention or utility model fall within the realms of ¡°prior art¡± then the novelty requirement shall be deemed not to have satisfied the requirements and therefore, not patentable under Chinese Laws. Under the 2008 Act,¡°Prior art¡± is defined as ¡°any technology known to the public before the filing date of the patent application in China or abroad.¡± This amendment aligns China¡¯s Patent regime with the standards under Article 54(2) of the European Patent Convention which states that, ¡°the state of the art shall be held to comprise everything made available to the public by means of a written or oral description, by use, or in any other way, before the date of filing of the European patent application.¡±

China News 0 Comment November 18, 2009, 5:45 pm

Xiamen Airlines¡¯ blacklist case

Beijing, China ¨C November 12, 2009

Fan Houjun, 37, who once worked as a security guard at the Fuzhou branch of Xiamen Airlines, based in Fujian province, was refused boarding aircraft of Xiamen Airlines seven times. A spokesman for the airline claimed Fan was trying to disturb the airline's normal operations in revenge over a labor dispute with the company four years ago. But Fan says he's been treated unfairly and has filed a lawsuit against the airline for discrimination and wants compensation of 60,000 yuan - around $9,000, and says he has no difficulty boarding aircrafts of other companies.

Fan's lawyer Zhang Qihuai said that the actions of Xiamen Airlines seriously violated Fan's rights. Xiao Shuwei, a lawyer representing Xiamen Airlines, said Fan's words and acts posed a potential threat to other passengers, and the company had the right to refuse service.

On 10th November, Chaoyang district court ruled Fan Houjun had lost his case. Wang Ying, president of the tribunal, said at a press conference after the hearing that the denial was a protective measure on the legitimate interests of other passengers, considering Fan's violent words and acts. It was also in line with international practices.

Meanwhile, the Chaoyang district court sent an advisory to the Civil Aviation Administration of China (CAAC) and Xiamen Airlines, saying airlines need to standardize the denial processes and make them publicly available after the CAAC examination.

Lehman lawyers remarks that according to international aviation practices, airline companies are authorized to deny passengers who threaten aircraft safety. But airlines must ensure the denial process is open and transparent, because it is conducive to protecting the legitimate rights and interests of passengers.

Lehman, Lee & Xu can provide expert legal representation and counsel throughout the investment process. Beyond contract drafting, the firm can also perform due diligence on Chinese firms and projects, provide corporate and tax counsel on the structure and operation of an investment, from mere CERs purchase deal, to direct engagement in the project development with a Chinese partner, or to technologies sales/licensing and equity injections in project companies.

For more information about the firm, please visit our website at www.lehmanlaw.com.

China News 0 Comment November 12, 2009, 1:59 pm

The Secondary Path of Evolution

Sam Engutsamy, November 2009.

Whilst sitting warmly inside, as the effects of last night¡¯s snow slide down from my window, I stumbled over a verdict delivered by Shanghai No. 1 Intermediate People¡¯s Court, which surprisingly hasn¡¯t received much coverage domestically, but has been picked up and highlighted more on an international level.

Following on from my last post, ¡®Q&A: PRC¡¯s Anti-monopoly legislation ¨C A quick overview of the law to date¡¯, I noted that more cases are likely to be decided under the Anti-monopoly Law (¡°AML¡±). This is possible by either investigative actions by bodies under the Enforcement Authority (¡°AMEA¡±) or via private actions under Article 50 of the AML, which states that ¡®where the undertakings implement Monopolistic Conducts and cause losses to others, the undertakings shall be held for civil liabilities in accordance with the laws.¡¯

This decision is the first to be released by a court under the AML since its enactment in August 2008. Filed by Beijing Sursen Electronic Co, (¡°Sursen¡±), against two Shanghai based companies, Shanghai Shanda Network Development Co, and Shanghai Xuanting Entertainment Information and Technology Co, (¡°Defendants¡±), China¡¯s first court decided case concerned the issue of dominant market position of the online literature market. Essentially, Sursen claimed that as a result of the defendants prohibiting them from writing a sequel to a popular novel, this allowed the defendants to have a dominant market position of the online literature market, and consequently Sursen were seeking approximately RMB 17,000 in damages, and a public apology. Dismissing the claim, Shanghai No. 1 Intermediate People¡¯s Court found no proof from the evidence provided that the defendants held a dominant market position.

Additionally, another case concerning dominant market positions involving China Mobile was settled, with the company paying the plaintiff a sum of money for his suggestions and not as a reimbursement. Consequently, such a settlement could open the floodgates to additional private action claims under Article 50, however based on the fact that China Mobile remunerated the plaintiff for his suggestions, and for helping them with the improvement of their services, it is unlikely this will be the case.

The AML¡¯s overall evolution is predominantly and primarily taking effect via the release of guidance notes from bodies under the Anti-monopoly Commission (¡°AMC¡±) and the publication of cases by Mofcom in accordance with their statutory obligations under Article 30 of the AML. The AML may find itself branching off and forming a secondary path of evolution as a result of the powers vested under Article 50. It is hoped that pending cases (cases such as China Network and Baidu) will provide a greater insight on the future of this secondary path of evolution.

Additional update:
October 30th 2009, saw Mofcom release its sixth merger decision case, placing restrictive conditions of the acquisition of Sanyo Electric by Panasonic.
Please note that Mofcom only have a statutory obligation under Article 30 of the AML to publish mergers that have either been rejected, or have restrictive conditions placed on them. They are under no obligation to published mergers that have been approved.

Mofcom¡¯s publicised merger decisions to date:


China Law 0 Comment November 10, 2009, 5:12 pm

Shanghai: The Silicon Valley of Clean Energy

Recently, U.S. Energy Secretary Steven Chu and Commerce Secretary Gary Locke met with business executives in The U.S. to promote climate change legislation. From venture capitalists to members of the Obama administration, speakers were fretting that China might take over as leader in green innovation. And their fears are valid.
While the U.S. has teetered on setting a floor price on carbon, an act that would significantly increase the incentive for innovation, China has ordered strict renewable energy and efficiency goals. It has called for fuel efficiency standards for cars that are more stringent than the U.S. (42 MPG vs 39 MPG), passed a larger investment tax credit for solar energy and wind energy (50% vs 30%), and are aggressively pushing for 20% use of renewable energy by 2020.
Steve Westly, former State Controller and one of the top Democrats running for the 2006 California Governor position, is a strong believer in China¡¯s bid to become leader of the greentech industry. Having recently raised a $140 million fund to invest in China¡¯s greentech industry, Westly states, ¡°China will pass the U.S. in 20 years as the largest economy in the world. There are only two countries that matter- the U.S. and China. They create 40% of the world¡¯s pollution, and the other 191 countries divvy up the rest¡­.I go to China every 90 days ¨C China knows the big health issues they¡¯re facing,¡± he told the audience at the Cooley Godward law frim-organized conference.

Here¡¯s Wall Street Journal reporting on the comments by Chu and Locke:

Both Chu and Locke recently returned from a tour of China, and the gains the Communist state has made in the industry through its clean-energy fiats, ¡°demonstrates to us¡­just how much more concerted and aggressive we have to be to respond in terms of climate change and renewable energy,¡± the commerce secretary said. 

¡±It¡¯s a matter of economic competitiveness,¡± Locke said. 

¡±If we don¡¯t get our act together, we¡¯re going to be watching the capital, the business and the good-paying jobs end up someplace else. Some 10-15 years from now, we¡¯re going to be saying, ¡®How did Shanghai become the Silicon Valley of clean energy?¡¯¡± he added. 

Chu said Democrats¡¯ plans to ratchet down greenhouse gas-emission levels in the U.S would ¡°spur innovation that will far exceed what China can ever do.¡± 

Though the House passed a landmark climate bill earlier this year and Senate committees next week will begin consideration of a similar version, a raft of political hurdles lie ahead for the legislation....

China News 0 Comment November 9, 2009, 2:27 pm

Q&A: PRC¡¯s Anti-monopoly legislation - A quick overview of the law to date

When was PRC¡¯s Anti-monopoly legislation enacted?
The PRC Anti-monopoly law (AML 2008) was promulgated on 30 August 2007 by the Twenty Ninth Meeting of the Standing Committee of the Tenth National People¡¯s Congress of the PRC. The legislation took effect from 01 August 2008.

The PRC were due to enact anti monopoly legislation in 1994, after the establishment of a socialist market economy in 1993, however the process dragged on for 13 years until finally the AML 2008 was passed.

What are the aims of the AML 2008?
Article 1 PRC¡¯s AML 2008 states:

¡®This Law is enacted for the purpose of preventing and restraining monopolistic conducts, protecting fair competition in the market, enhancing economic efficiency, safeguarding the interests of consumers and social public interest, promoting the healthy development of the socialist market economy.¡¯

Article 2 PRC¡¯s AML 2008 states:

¡®This Law shall be applicable to monopolistic conducts in economic activities within the People¡¯s Republic of China.¡¯

What actions are classified as ¡®monopolistic conducts¡¯?
Monopolistic conduct can include: (i) monopolistic agreements among business operators, (ii) abuse of dominant market positions by business operators, and (iii) concentration of business operators that eliminates or restricts competition or might be eliminating or restricting competition.

How was it envisaged that the AML 2008 be enforced?The AML 2008 created two bodies, the Anti-monopoly Commission (AMC), and the Anti-Monopoly Enforcement Authorities (AMEA)

AMC: The primary role of the AMC is to formulate Anti-monopoly policies.

AMEA: The AMEA is made up of three bodies. The Ministry of Commerce (Mofcom), the State Administration for Industry and Commerce (SAIC) and the National Development and Reform Commission (NDRC). Each body is allocated with enforcing certain aspects of the AML 2008.

What aspects of the AML 2008 do the members of the AMEA deal with?
Mofcom: Mofcom¡¯s official role is that of merger reviewer. If certain thresholds are met, then Mofcom will basically examine the implications of the proposed merger & acquisition. It has the power to reject, approve, or conditionally approve a merger.

SAIC: The role of the SAIC extends to non price related anti competitive actions. It may carry out investigations into cartel arrangements, and abuse of a dominant market position.

NDRC: Where the SAIC investigates the non price related aspects of the above anti monopolistic behaviour, the NDRC investigates price related actions.

There is considerable overlap between the SAIC and NDRC. Further reform may look at consolidating the resources of these two bodies into one.

What Anti-monopoly policies have been produced?Below are some of the policies that have been produced.
(i) Regulations on Notification Thresholds for Concentrations of Undertakings: Outlined the thresholds that would require Mofcom notification. These were not addressed under the AML 2008.
(ii) Methods for Calculating the Turnover of Financial-Sector Business Operators: Outlined and detailed the formulae that should be used by companies in assessing whether Mofcom notification was required.

(i) Procedural Rules on Monopoly Agreements and Abuse of Dominance: Outlined the scope of SAIC investigations

To date NDRC have only issued a draft policy titled Provisions Against Monopolistic Pricing, which were available for public comment until 06 September 2009.

What cases have been decided under the AML 2008 to date?
There have been three main cases since the enforcement of the AML 2008. These cases are, (i) the acquisition of Anheuser-Busch by InBev, (ii) the proposed acquisition of Huiyuan by Coca-Cola, and (iii) the acquisition of Lucite by Mitsubishi. Mofcom are only required to publish decisions where conditions have been imposed, or the merger has been rejected. There are no requirements to published decisions that have been approved.

The former, and the latter were approved, however Mofcom placed conditions on the mergers. For example, under the InBev case, the company had to agree not to increase their current holdings in either Tsingtao Brewery, or Zhujiang Brewery, and in the Mitsubishi case Mofcom imposed de-investment conditions on the company.

The Coca-Cola merger with Chinese company Huiyuan was rejected. Mofcom outlined three justifications for rejection, including that if the merger went ahead then domestic SME would be restricted and limit the market. As a result of this, and coupled with the dissent amongst the Chinese public there were calls that the decision was based on protectionism. Mofcom strongly denies such claims.

More recently, Mofcom has conditional approved two further mergers a few days prior to the CPC¡¯s 60th anniversary: (a) acquisition of Delphi Corporation by General Motors Company, announced on 28th September 2009, and (b) acquisition of Wyeth Inc by Pfizer Inc, announced on 29th September 2009.

What can we expect to see from the AML 2008 in the future?
We are likely to see the SAIC and NDRC step forward and lead the way in the implementation and enforcement of the AML 2008. Mofcom is still likely to play a large role as M&A have long been an established procedure within the PRC.

More policies are likely to be produced, and more cases decided under the AML 2008.

Sam Engutsamy
November 2009...

China News 4 Comment November 6, 2009, 2:46 pm

My step 3: Unknown territory

Having graduated in 2008, the year that saw the collapse of Lehman Brothers, the nationalisation of banking institutions, and the overall entry of world¡¯s nations into an economic slump, I knew that things were not going to be a walk in the park!

My plan was already set out. Finish university, take a year out in the aid of differentiating myself from my peers and competition, and then pounce on the Legal Practice Course, commencing in September 2009 (I¡¯m a British Law student by the way) and whilst on the course secure a training contract at a London based law firm.

Ok, so I did finish university, achieving a 2.1 Honours Law degree from City University, London. Step 1 complete. I did take a year out, and during that period managed to secure a placement on the summer associate program at the Beijing office of Lehman, Lee & Xu, ok bingo Step 2 complete. So now I¡¯m sure you¡¯re thinking that I¡¯ve moved onto Step 3, and am writing this from the comforts of my luxury penthouse in central London? Well if you thought so you¡¯re wrong! Firstly, if I had gone back to do my LPC I would most likely be commuting from my parents house (the joyful consequences of student debt, and the fact that in the UK there is no student funding available for the LPC), and secondly I haven¡¯t gone back, I¡¯m still in Beijing!

What happened to Step 3? Well everyone knows how competitive law (as well as most industries these days) is, whether you¡¯re aiming for a magical circle firm, or a high street firm. In law your competing against a multitude of groups such as (i) your friends and foes you graduated with, (ii) those people who did not study law, and converted their degrees in order to practice (iii) those people feeling the effects of the economy and decided to diversify their backgrounds by entering into law, and (iv) those people who have been unsuccessful in previous years in attaining a training contract. Those four groups (and potentially a lot more) = a lot of competition for me!

Through the advice of good friends both here and back home, and family, (hi everyone) I decided that the best way to differentiate myself from the competition would be by staying on in Beijing for a few extra months and gaining some vital experience working at Lehman, Lee & Xu. After weeks of tooing and throwing I made my mind up! LPC cancelled (deposit lost, but at least I didn¡¯t have to pay the full course fees), flights back to London Heathrow pushed forward, and new flat sorted; I was staying!

The decision to stay was a hard one. I felt I had to stick to my plan, and that there was no alternative. However you look at it, be it an opportunity or a risk, I feel that it has proven to be one of the best decisions I could have taken for my future career. It¡¯s not like you get the opportunity to come to China everyday now is it?

I have learn a lot from this summer associate program at Lehman, Lee & Xu, and are grateful to them for allowing me to stay on. I am currently working on an intellectual property law project, and I am in the process of finishing up an article regarding China¡¯s Anti-monopoly legislation. Both areas of law I have a great interest in.
I have met some great friends out here, who know doubt I will keep contact with for the considerable future, and I have had some amazing experiences that I will never forget. By amending my step 3, I have steered of the cautious road I was due to be taking, and look, with excitement, to charter into unknown territory.

Have you had any thoughts about changing your step 3?

Articles of interest:

New York Times:

Associated Press:
Sam Engutsamy
November 2009...

China Blawg's thoughts 0 Comment November 6, 2009, 2:44 pm

Studying in China

Arriving at Beijing Capital International Airport at the end of August 2009, I was immediately overwhelmed. The massive complex, complete with its own train to ferry you to your baggage, confronts you with the realization, ¡°I¡¯m in China right now.¡± After a good bit of waiting for other students to arrive, we were whisked off to a bus ready to take us to school, Peking University. The bus ride, itself, was an experience. As we rode through the streets of Beijing, we were immediately overwhelmed by the size of the city and the number of people. We could see the Bird¡¯s Nest and the Water Cube from the highway. By the time we arrived at Beida, we were awestruck.

Given some time to transition, we then began classes. Thankfully, my courses are conducted in English, as my Chinese is simply not good enough for Chinese instruction. Luckily, one of my classes¡ªSino-American Relations¡ªis also attended by a few Chinese students, in addition to all the other Westerners. This allows for an interesting dialogue on the issues at hand. The ideas communicated by both the Western and Chinese students are truly intriguing and eye-opening.

China Culture 0 Comment November 5, 2009, 2:23 pm

Interning at Lehman, Lee & Xu

Three months ago I arrived in Beijing to an entirely different world from that which I had grown up in. Where Washington D.C. is staid and exhaustively organized, Beijing is a picture of vibrancy and chaos. The rapid change that has taken hold of the city adds an air of excitement to Beijing that cannot be replicated in any Western city I have ever visited. One gets the sense, living in China, that this is a country on the cusp of great things; and it feels like the chance of a lifetime to be witnessing China¡¯s growth first hand.

Lehman, Lee & Xu is an example of how far China has come in the last couple of decades. Emerging just as China¡¯s legal system was being privatized and developed, Lehman, Lee & Xu ¡®s growth and development shows how greatly economic progress can affect life and business in China. As an American student, being an intern here was fascinating. I was able to undertake much more substantive tasks than I would as an intern at the over-staffed American law firms and could witness the firm¡¯s progress and involvement in some landmark areas of Chinese law. Law firms like Lehman, Lee & Xu are making doing business in China more accessible than ever, and I believe that this will be seen in the continued growth of domestic and foreign investment in China in the coming years.

China News 0 Comment November 5, 2009, 2:21 pm

Opportunities in China¡¯s Water Industry

Quinn P. Stepan

¡°When the well is dry, we know the worth of water.¡± Benjamin Franklin, Poor Richards Almanac

After almost 30 years of double digit economic growth and the migration of hundreds of millions of villagers to cities, gaining access to clean water becomes a bigger issue by the day for many residents of China. If the current trend continues, China¡¯s water supply, or lack thereof, has the ability to halt industrial and population growth in one of the worlds most expansive and dynamic economies.
The majority of China¡¯s 270,550 sq km of water is polluted, threatened by drought or being overused. I have read some reports estimating as much as 90% of China¡¯s water supply is polluted. This, of course, is a by product of rapid economic expansion. Today, there are few restrictions or legal enforcement preventing firms from dumping waste products in large bodies of water. This is very similar to what happened in The United States during the Industrial Revolution. Overuse primarily comes from China¡¯s dominant agricultural sector and droughts affect 15% of the country forcing some 300 million people living in rural areas to travel great lengths for safe drinking water.
In its 11th five year plan, China dedicated 1 trillion RMB in attempts to alleviate the water crisis. Most of the money will go towards desalinization and reclamation projects. There is one ambitious plan to move water from water rich regions such as the Yangtze River to the deprived Yellow River. However, moving water around is not the final answer to the problem.
Many firms, both foreign and domestic, are positioning themselves to take full advantage of the current water crisis in China. Companies looking to take advantage of this future trend range from high tech purification services to firms that deal more in water transportation and infrastructure. In the water business, having exposure to China should allow firms to benefit from Beijing¡¯s attempts to bring cleaner water throughout a country in great need. Gaining access to clean water becomes a bigger issue by the day for many in China.

China Blawg's thoughts 1 Comment November 5, 2009, 11:08 am

Asia Legal Business to host summit in Beijing

Lehman, Lee & Xu has been a perennial supporter of the ALB In-house legal summit Beijing since its inception six years ago. Asia¡¯s most respected legal industry publication, Asian Legal Business Magazine, is proud to present ALB In-house legal summit Beijing on 26 November 2009. This special one-day event is tailored to bring together leading senior-level corporate counsel, business leaders and private practice lawyers. Topics being discussed at this year¡¯s summit will include risk and opportunities for Chinese companies in a year of economic transition, employment law developments and the changes Chinese corporations are facing with regards to governance and risk management. The summit will comprise of in depth workshops focusing on the latest legal issues presented by top domestic and international law firms, a managing partner forum that will be exploring Sino-Foreign cooperation where China will be playing a larger Roll and a panel discussion on the vital role of in-house counsel by some of China¡¯s most distinguished and dynamic corporate counsel. The keynote speaker will be Ferheen Mahomed who acts as the Regional General Counsel for Societe Generale. Other distinguished speakers will be representing such firms as Grandall Legal Group, TransAsia Lawyers, Wilson, Sunsini, Goodrich & Rosati, Withers Worldwide, Proctor and Gamble, Shell and The TOM Group.

The event will be held at the Swissotel Beijing Hong Kong Macau Center. For further information regarding this event, please visit the events web page at http://beijing.theinhousesummit.com/register/register.aspx

China News 0 Comment November 5, 2009, 10:40 am

Asia Legal Business to host summit in Beijing

Lehman, Lee & Xu has been a perennial supporter of the ALB In-house legal summit Beijing since its inception six years ago. Asia¡¯s most respected legal industry publication, Asian Legal Business Magazine, is proud to present ALB In-house legal summit Beijing on 26 November 2009. This special one-day event is tailored to bring together leading senior-level corporate counsel, business leaders and private practice lawyers. Topics being discussed at this year¡¯s summit will include risk and opportunities for Chinese companies in a year of economic transition, employment law developments and the changes Chinese corporations are facing with regards to governance and risk management. The summit will comprise of in depth workshops focusing on the latest legal issues presented by top domestic and international law firms, a managing partner forum that will be exploring Sino-Foreign cooperation where China will be playing a larger Roll and a panel discussion on the vital role of in-house counsel by some of China¡¯s most distinguished and dynamic corporate counsel. The keynote speaker will be Ferheen Mahomed who acts as the Regional General Counsel for Societe Generale. Other distinguished speakers will be representing such firms as Grandall Legal Group, TransAsia Lawyers, Wilson, Sunsini, Goodrich & Rosati, Withers Worldwide, Proctor and Gamble, Shell and The TOM Group.

The event will be held at the Swissotel Beijing Hong Kong Macau Center. For further information regarding this event, please visit the events web page at http://beijing.theinhousesummit.com/register/register.aspx...

Lehman Affairs 0 Comment November 4, 2009, 5:10 pm

China frowns on World of Warcraft operator

China's No.2 Internet games operator NetEase.com Inc said it has been notified by a Chinese government agency that its operation of the World of Warcraft game does not have proper approval.

Shares of NetEase were down 4.2 percent at $36.99 in early afternoon trading.

China's General Administration of Press and Publication posted a statement on its Website that the NetEase affiliate company that operates World of Warcraft should suspend charging users to play the game and not allow new account registrations, according to NetEase.

The agency is also evaluating whether to impose administrative penalties on Shanghai EaseNet, the NetEase affiliate, and that the agency was returning the affiliate's application for approval, NetEase said.

NetEase and Shanghai EaseNet said they believe they are in full compliance with applicable Chinese laws and that they are seeking clarification from the relevant authorities regarding the statement by the General Administration of Press and Publication.

NetEas licenses the online multiplayer game World of Warcraft from Activision Blizzard.

Source: Reuters

China News 0 Comment November 3, 2009, 10:37 am

Losing a finger to win justice

By Cao Li

Sun Zhongjie had to lose a finger to win justice. The teenager experienced 12 days of hell after he was accused of driving an illegal taxi in Shanghai this month and wept with joy on Monday when city officials finally cleared his name.

His ordeal may be over, but for the local traffic enforcement authority, which is now under investigation for allegations they use "civilian bait" to trap innocent people, the fight to restore its reputation could take a lot longer.

Sun attracted nationwide attention to his plight when he cut off the little finger on his left hand to prove he had been set up on Oct 14.

But the spotlight quickly shifted to the Shanghai City Administration and Law Enforcement Bureau for Pudong district after it was forced to apologize for using "improper" tactics to snare illegal, or "black", taxi drivers.

It is the first time a Chinese authority has admitted employing illegal methods to enforce the law and critics claim the problem could stretch far wider than traffic violations.

"Entrapment is allowed in China during investigations into certain types of crime, such as drug trafficking. But in Sun's case, he was simply the victim of extortion, which is totally different," said Zhang Peihong, vice-director of the criminal law research commission with the Shanghai Bar Association.

Sun, 19, had moved from his home in Shangqiu, Henan province, just two days before his employers at Pangyuan Construction Machinery Engineering Company ordered him to drive a company minivan to Hangtou, a town in Pudong, to pick someone up at about 8 pm.

"It was late and there were few cars on the street," recalled Sun. "I saw a man standing in the middle of the road, waving. I stopped the car, and he opened the (front passenger) door and got in without asking. He told me he was sick and cold, and begged me to give him a lift. I started to drive again but, within minutes, a van skidded to a stop in front of me at an intersection."

He said the passenger reached over and put his foot on the brake, took the ignition key and threw a 10-yuan note at Sun. He then jumped out of the car.

The van that cut across Sun's vehicle carried district enforcement bureau officers, who accused Sun of driving a black taxi. The minivan was confiscated and the teen was told he faced a fine of 10,000 yuan ($1,400) if the charge was proven....

China News 0 Comment November 2, 2009, 8:57 am