China
Why China wants to power Argentina’s air force modernisation
Author: Loro Horta, Dili
In early May, several media outlets reported that a Chinese delegation visited Argentina to discuss a major arms deal. The agreement could be a game changer for Argentina and South America’s arms market.
According to reports, the two governments discussed the possibility of selling Argentina Sino–Pakistan JF-17 fighter jets. If the deal goes ahead, this will be the most advanced fighter jet offered by China to the region and could pave the way for future arms deals with other South American countries.
This is not the first time that a major arms deal between China and Argentina has been announced. In 2015, the two countries signed a deal for Argentina’s purchase of several weapons systems. Estimated at US$1 billion, the deal included warships, armoured vehicles and fighter jets. That same year, Argentina’s Defence Minister Agustin Rossi announced that the JF-17 was among the items to be purchased from China.
These agreements were signed during the presidency of Cristina Fernandez de Kirchner (2008–2015), the left-wing and Peronist leader who built close ties with China. The election of right-leaning president Mauricio Macri in December 2015 led to the cancellation of these projects. But since 2019, with the return of a Peronist government and with Kirchner as Vice President, these arms deals are being resuscitated.
Argentina’s financial crises and lack of currency with which to acquire expensive weapon systems have long been an obstacle for China selling defence equipment to Argentina. Yet several factors have emerged that increase the likelihood of success for Chinese weapons companies.
The Argentine Air Force has reached a critical point in its fighter jet inventory. For decades, the French-built Dassault Mirage III interceptor aircraft was the backbone of the Argentinian fighter jet force. In 2015, due to aging aircraft and budget constraints, the Argentine Air Force was forced to retire its fighter jets.
For six years now, Argentina has not possessed fighter interceptors, despite neighbouring countries Brazil and Chile owning modern fighter jets. Argentina has tried to buy new jets from several Western nations, but the UK government has kept an effective arms embargo on the country since the 1982 Falklands War.
The United Kingdom is particularly sensitive to acquisitions of fighter jets, remembering that most UK casualties in the Falklands War were inflicted by the Argentine Air Force. In 2015, Argentina tried to acquire Swedish JAS 39 Gripen fighter jets, but Sweden backed down from the sale due to pressure from London. South Korea also withdrew its offer to sell Argentina fighter jets due to pressure from the United Kingdom. Even the fact that the ejector seat on the JF-17 is built by a UK company has been a point of contention.
Not only are Western arms markets highly restricted in Buenos Aires, but Argentina remains on the verge of bankruptcy. Chinese fighter jets are cheaper than Western ones. China also provides flexible modes of payment and periods of good will, where recipients are not required to pay for several years or can pay in instalments. With Venezuela, US sources claim that China sold weapons on generous terms in exchange for oil at low prices.
The fact that China is willing to jointly produce the JF-17 and share its technology with Argentina further sweetens the deal. Argentina has long preferred agreements that allow for technology transfers in an effort to strengthen its defence industry. Both nations are also negotiating licensing for Argentina to produce Chinese helicopters and armoured vehicles.
While some Argentinian politicians and some sectors in the military have objected to close military cooperation with China, they have not come up with any alternatives. All branches of the Argentinian military, not just the air force, are in urgent need of modernisation.
If the deal goes ahead, the JF-17 project could lay the ground for China’s emergence as a major weapons supplier in a region once dominated by the United States. Yet Beijing’s strategy of financial flexibility with Argentina goes beyond weapons.
Argentina is the second-largest country in Latin America and a member of the G20. The country’s large and sparsely populated territory is rich in natural resources. In March, Argentinian media, citing sources in the President’s office, reported that China and Argentina were negotiating 15 infrastructure projects worth US$30 billion. Chinese companies have invested an estimated US$15 billion in the country’s oil sector. Argentina is…
China
New Publication: A Guide for Foreign Investors on Navigating China’s New Company Law
The sixth revision of China’s Company Law is the most extensive amendment in history, impacting foreign invested enterprises with stricter rules on capital injection and corporate governance. Most FIEs must align with the New Company Law by July 1, 2024, with a deadline of December 31, 2024 for adjustments. Contact Dezan Shira & Associates for assistance.
The sixth revision of China’s Company Law represents the most extensive amendment in its history. From stricter capital injection rules to enhanced corporate governance, the changes introduced in the New Company Law have far-reaching implications for businesses, including foreign invested enterprises (FIEs) operating in or entering the China market.
Since January 1, 2020, the Company Law has governed both wholly foreign-owned enterprises (WFOEs) and joint ventures (JVs), following the enactment of the Foreign Investment Law (FIL). Most FIEs must align with the provisions of the New Company Law from July 1, 2024, while those established before January 1, 2020 have bit more time for adjustments due to the five-year grace period provided by the FIL. The final deadline for their alignment is December 31, 2024.
In this publication, we guide foreign investors through the implications of the New Company Law for existing and new FIEs and relevant stakeholders. We begin with an overview of the revision’s background and objectives, followed by a summary of key changes. Our in-depth analysis, from a foreign stakeholder perspective, illuminates the practical implications. Lastly, we explore tax impacts alongside the revisions, demonstrating how the New Company Law may shape future business transactions and arrangements.
If you or your company require assistance with Company Law adjustments in China, please do not hesitate to contact Dezan Shira & Associates. For more information, feel free to reach us via email at china@dezshira.com.
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
Lingang New Area in Shanghai Opens First Cross-Border Data Service Center to Streamline Data Export Process
The Lingang New Area in Shanghai has launched China’s first Cross-Border Data Service Center to facilitate data export for companies in Shanghai. The center will help with applications, data catalogs, and management, aiming to provide legal and safe cross-border data transfer mechanisms.
The Lingang New Area in Shanghai’s Pilot Free Trade Zone has launched a new cross-border data service center to provide administrative and consulting services to companies in Shanghai that need to export data out of China. The service center will help facilitate data export by accepting applications from companies for data export projects and is tasked with formulating and implementing data catalogs to facilitate data export in the area. The Shanghai cross-border data service center will provide services to companies across the whole city.
The Lingang New Area in the Shanghai Pilot Free Trade Zone has launched China’s first Cross-Border Data Service Center (the “service center”). The service center, which is jointly operated by the Cybersecurity Administration of China (CAC) and the local government, aims to further facilitate legal, safe, and convenient cross-border data transfer (CBDT) mechanisms for companies.
The service center will not only serve companies in the Lingang New Area but is also open to companies across Shanghai, and will act as an administrative service center specializing in CBDT.
In January 2024, the local government showcased a set of trial measures for the “classified and hierarchical” management of CBDT in the Lingang New Area. The measures, which have not yet been released to the public, seek to facilitate CBDT from the area by dividing data for cross-border transfer into three different risk categories: core, important, and general data.
The local government also pledged to release two data catalogs: a “general data” catalog, which will include types of data that can be transferred freely out of the Lingang New Area, and an “important data” catalog, which will be subject to restrictions. According to Zong Liang, an evaluation expert at the service center, the first draft of the general data catalog has been completed and is being submitted to the relevant superior departments for review.
In March 2024, the CAC released the final version of a set of regulations significantly facilitating CBDT for companies in the country. The new regulations increase the limits on the volume of PI that a company can handle before it is required to undergo additional compliance procedures, provide exemptions from the compliance procedures, and clarify the handling of important data.
Also in March, China released a new set of technical standards stipulating the rules for classifying three different types of data – core, important, and general data. Importantly, the standards provide guidelines for regulators and companies to identify what is considered “important” data. This means they will act as a reference for companies and regulators when assessing the types of data that can be exported, including FTZs such as the Lingang New Area.
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
A Concise Guide to the Verification Letter of Invitation Requirement in the China Visa Process
The application procedures for business visas to China have been simplified, with most foreigners now able to apply for an M/F visa using only an invitation letter from a Chinese company. Some countries are eligible for visa-free entry. However, a Verification Letter of Invitation may still be needed in certain cases. Consult the local Chinese embassy for confirmation.
In light of recent developments, the application procedures for business visas to China have undergone substantial simplification. Most foreigners can now apply for an M/F visa using only the invitation letter issued by a Chinese company. Additionally, citizens of certain countries are eligible to enter China without a visa and stay for up to 144 hours or even 15 days.
However, it’s important to note that some applicants may still need to apply for a “Verification Letter of Invitation (邀请核实单)” when applying for an M/F visa to China. In this article, we will introduce what a Verification Letter of Invitation is, who needs to apply for it, and the potential risks.
It’s important to note that in most cases, the invitation letter provided by the inviting unit (whether a public entity or a company) is sufficient for M/F visa applications. The Verification Letter for Invitation is only required when the Chinese embassies or consulates in certain countries specifically ask for the document.
Meanwhile, it is also essential to note that obtaining a Verification Letter for Invitation does not guarantee visa approval. The final decision on granting a visa rests with the Chinese embassy abroad, based on the specific circumstances of the applicant.
Based on current information, foreign applicants in Sri Lanka and most Middle East countries – such as Turkey, Iran, Afghanistan, Syria, Pakistan, and so on – need to submit a Verification Letter for Invitation when they apply for a visa to China.
That said, a Verification Letter for Invitation might not be required in a few Middle East countries, such as Saudi Arabia. Therefore, we suggest that foreign applicants consult with their the local Chinese embassy or consulate to confirm in advance.
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.
- New Publication: A Guide for Foreign Investors on Navigating China’s New Company Law
- Lingang New Area in Shanghai Opens First Cross-Border Data Service Center to Streamline Data Export Process
- A Concise Guide to the Verification Letter of Invitation Requirement in the China Visa Process
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