China
Software Group: More Piracy, More Lawsuits Coming in China
Lawsuits over the use of pirated software from companies like Microsoft and Adobe Systems are likely to ramp up in China in the next year, the head of the Business Software Alliance, an industry advocacy group, said Monday. The remarks come as software makers continue to suffer large losses in China due to rampant piracy in the country, despite frequent campaigns by the Chinese government to stamp out intellectual property abuses. Lawsuits launched by BSA’s member companies or by BSA on their behalf are likely to become more common as piracy becomes a bigger problem in China, the group’s chief executive Robert Holleyman told reporters in Beijing. “The problem here is getting bigger and there are more instances of piracy” occurring, as growth in China’s personal-computer market outweighs the country’s gradually falling piracy rate, Mr. Holleyman said. BSA estimated that 78% of the PC software installed in China last year was pirated, down from 82% in 2006. Despite that, growth in the Chinese PC market means piracy is occurring more often overall. “The dollar loss, the lost opportunity, is really exploding,” Mr. Holleyman said. Microsoft and other software makers have for years used lawsuits to combat piracy of their products in China. Mr. Holleyman declined to elaborate on how much more common he thought they might become. Microsoft and Adobe didn’t immediately reply to requests for comment. Other BSA members include Apple and design-software maker Autodesk. Mr. Holleyman said he hopes China can reduce its piracy rate by 10 percentage points within four years. He urged China’s government to take further measures to fight piracy, including updating the country’s copyright law and publicly highlighting the computer-security dangers of pirated software, which is more susceptible to problems like computer viruses. China in the second quarter surpassed the U.S. to become the world’s biggest PC market , according to market research firm IDC. But highlighting how little the Chinese PC market’s growth has boosted software makers, Microsoft CEO Steve Ballmer in May said the company’s revenue in China this year would only be about 5% of what it gets in the U.S. , due to widespread piracy. Mr. Holleyman also raised concerns about barriers to market access in China for foreign software makers. “I continue to hear concerns about what is happening at provincial levels or municipal levels, where statements are being made that governments should only acquire domestic Chinese software,” he said. China since last year has taken various steps to ease restrictions in its controversial policies on government procurement, but some concerns remain among foreign industry and government officials about limits on foreign companies. – Owen Fletcher. Follow him on Twitter @owenfletcher
Lawsuits over the use of pirated software from companies like Microsoft and Adobe Systems are likely to ramp up in China in the next year, the head of the Business Software Alliance, an industry advocacy group, said Monday. The remarks come as software makers continue to suffer large losses in China due to rampant piracy in the country, despite frequent campaigns by the Chinese government to stamp out intellectual property abuses. Lawsuits launched by BSA’s member companies or by BSA on their behalf are likely to become more common as piracy becomes a bigger problem in China, the group’s chief executive Robert Holleyman told reporters in Beijing. “The problem here is getting bigger and there are more instances of piracy” occurring, as growth in China’s personal-computer market outweighs the country’s gradually falling piracy rate, Mr. Holleyman said. BSA estimated that 78% of the PC software installed in China last year was pirated, down from 82% in 2006. Despite that, growth in the Chinese PC market means piracy is occurring more often overall. “The dollar loss, the lost opportunity, is really exploding,” Mr. Holleyman said. Microsoft and other software makers have for years used lawsuits to combat piracy of their products in China. Mr. Holleyman declined to elaborate on how much more common he thought they might become. Microsoft and Adobe didn’t immediately reply to requests for comment. Other BSA members include Apple and design-software maker Autodesk. Mr. Holleyman said he hopes China can reduce its piracy rate by 10 percentage points within four years. He urged China’s government to take further measures to fight piracy, including updating the country’s copyright law and publicly highlighting the computer-security dangers of pirated software, which is more susceptible to problems like computer viruses. China in the second quarter surpassed the U.S. to become the world’s biggest PC market , according to market research firm IDC. But highlighting how little the Chinese PC market’s growth has boosted software makers, Microsoft CEO Steve Ballmer in May said the company’s revenue in China this year would only be about 5% of what it gets in the U.S. , due to widespread piracy. Mr. Holleyman also raised concerns about barriers to market access in China for foreign software makers. “I continue to hear concerns about what is happening at provincial levels or municipal levels, where statements are being made that governments should only acquire domestic Chinese software,” he said. China since last year has taken various steps to ease restrictions in its controversial policies on government procurement, but some concerns remain among foreign industry and government officials about limits on foreign companies. – Owen Fletcher. Follow him on Twitter @owenfletcher
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Software Group: More Piracy, More Lawsuits Coming in China
The New Company Law brings substantial changes with implications for new and existing foreign invested enterprises and stakeholders. Foreign investors must assess if adjustments to existing structures
Despite recent economic challenges, many organizations’ China operations provide unparalleled access to one of the world’s largest and most competitive global supply chains. Over the past 30 years, a significant number of foreign invested enterprises (FIEs) have been established in China. As of the end of 2022, the number of FIEs operating in China had exceeded 1.12 million.
Compared to their domestic counterparts, FIEs demonstrate greater caution regarding legal revisions and are diligent in making swift adjustments. This stems not only from the closer scrutiny FIEs face from regulatory authorities but also from their commitment to compliance and maintaining a competitive edge.
Clearly, there has been a shift in China’s corporate regulations—from merely encouraging an increase in the number of companies to focusing on attracting mature enterprises and higher-quality investments. While the transition from a broad approach to a more refined one may cause short-term challenges, it ultimately benefits the company’s long-term development. By returning to the original intent of setting registered capital, it not only protects the interests of creditors but also shields shareholders from the operational risks of the company.
In China’s foreign investment landscape, while most FIEs exercise commercial prudence in determining registered capital—factoring in capital expenditures, operational costs, and setting aside surplus funds—some opt for higher registered capital levels to avoid future capital increase procedures. This typically involves lengthy document signing and registration changes, lasting 1-2 months.
Joint ventures (JVs) often impose stricter payment deadlines for registered capital in their articles of association to ensure both parties’ simultaneous contributions align with operational needs. Conversely, wholly foreign-owned enterprises (WFOEs) tend to favor flexibility in payment deadlines, often allowing full payment before the company’s operational period expires.
Given these circumstances, despite the generally stronger capital adequacy among foreign companies compared to domestic entities, many FIEs could be affected by the new capital contribution rules.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
Foreign Tourist Groups on Cruise Ships Fully Permitted Visa-Free Entry in China
China will allow visa-free entry for foreign tourist groups arriving by cruise ship at 13 ports along the coast, starting May 15, 2024. Visitors must stay with the same ship and in permitted areas for up to 15 days. This policy aims to boost tourism and facilitate high-quality development in the cruise industry.
China’s immigration agency announced that it will grant a visa-free policy for foreign tourist groups to enter China by cruise at all cruise ports along the coast of China, starting May 15, 2024. The tourist group must remain with the same cruise ship until its next port of call and stay within permitted areas for no more than 15 days.
Effective May 15, 2024, the National Immigration Administration (NIA) has officially implemented a visa-free policy for foreign tourist groups entering China via cruise ships. This progressive move aims to enhance personnel exchanges and foster cooperation between China and other nations, furthering the country’s commitment to high-level openness.
Under this policy, foreign tourist groups, comprising two or more individuals, who travel by cruise ship and are organized by Chinese domestic travel agencies, can now enjoy visa-free entry as a cohesive group at cruise ports in 13 cities along the Chinese coast.
The tourist group must remain with the same cruise ship until its next port of call and stay within China for no more than 15 days. The eligible areas for this policy are coastal provinces (autonomous regions and municipalities) and Beijing.
Furthermore, to support cruise tourism development, seven additional cruise ports—Dalian, Lianyungang, Wenzhou, Zhoushan, Guangzhou, Shenzhen, and Beihai—have been included as applicable ports for visa-free transit.
The recent implementation of the visa-free policy for foreign tourist groups entering China via cruise ships is poised to have several significant effects. The policy will provide crucial support for the cruise economy and the overall cruise industry. By facilitating smoother travel for foreign tourist groups, it acts as a catalyst for high-quality development in this sector.
Additionally, under this policy, international cruise companies can strategically plan their global routes by designating Chinese port cities, such as Shanghai, Xiamen, and Shenzhen, as docking destinations. This move is expected to attract more cruise ships to Chinese ports, ultimately bringing in a larger number of international visitors to the Chinese market.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
China’s New Tariff Law: Streamlining and Standardizing Current Tariff Regulations
China’s new Tariff Law consolidates import and export duties, clarifies rules for imposing counter-tariffs, and sets a December 1, 2024 effective date. It codifies existing practices on cross-border e-commerce and rules on the origin of goods into law, impacting trade relations.
China’s new Tariff Law consolidates rules on import and export duties that were previously implemented via several legal documents and makes important clarifications and additions to prior regulations. Among other changes, it stipulates provisions for the Chinese government to impose counter-tariffs on imported goods, codifying these powers into law for the first time. We outline all the notable updates to the China Tariff Law and discuss the implications for the country’ current trade relations.
On April 26, 2024, the National People’s Congress (NPC), China’s legislature, adopted the Tariff Law of the People’s Republic of China (the “Tariff Law”) after several rounds of revisions.
The new Tariff Law will replace the Import and Export Tariff Regulations of the People’s Republic of China, which fall under the purview of the State Council, and adopts many of its provisions.
Previously, Chinese law had not stipulated legislative powers to implement countervailing tariffs, although China was nonetheless able to impose counter-tariffs on trade partners through other means.
China’s new Tariff Law comes into effect on December 1, 2024.
China’s Tariff Law elevates several existing provisions and practices to the level of law. For instance, Article 3 of the Tariff Law clarifies the obligations of cross-border e-commerce platforms for tariff withholding and implementing consolidated taxation.
The Tariff Law also solidifies the rules and regulations on the origin of goods, stipulating that the application of tariff rates shall comply with the corresponding rules of origin. Although this has been previously implemented in practice, it is the first time this has been codified into law.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
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- Foreign Tourist Groups on Cruise Ships Fully Permitted Visa-Free Entry in China
- China’s New Tariff Law: Streamlining and Standardizing Current Tariff Regulations
- Outlook on Bilateral Trade and Investment between China and United Arab Emirates (UAE)
- 2024 Tax Incentives for Manufacturing Companies in China
- Exploring the Revamped China Certified Emission Reduction (CCER) Program: Potential Benefits for International Businesses
