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Doing Business in China

Tips for Business Travel to China

The business world is constantly expanding and developing at different rates in different parts of the world.  To be sure, one could gain both a great insight and advantage from basing a business somewhere other than the United States.  Beijing in particular offers many such opportunities for growth and would be great for an American living abroad.

Being an American operating on foreign soil, one will have to go through various channels of government beforehand.  A good point to start at would be to visit some of the government sites talking about required forms for remaining in a foreign country for several years as well as tax rules and regulations.  The US Government provides an overview of the US tax forms one would still have to file and pay even if one lived in Beijing.

One should also make sure to have all their papers in order before venturing outside of the United States.  China has strict rules and regulations on entering and leaving the Country, and one should know that  a valid passport and visa are required to enter and exit China.  The visas given out by the Chinese government should be secured before traveling since attempt to enter China without both a valid visa and passport will result in a fine and immediate deportation at the traveler’s expense.

It is also important to remember that the visa’s limit your activities when in China.  The Chinese government requires foreigners entering China to undertake only the activity for which their visas were issued. If you decide to partake in an activity not mentioned in your passport, you will need specific permission from the appropriate authorities. If you violate the terms of your Chinese visas, including overstays, you will be subject to a maximum fine of 5,000 RMB, departure delays, and possible detention.

One a more particular note, if one happens to be a dual citizen of both the US and China, one should try to travel as an American.  The US will help either way if there is an issue however, “use of other than a U.S. passport to enter China can make it difficult for U.S. consular officers to assist dual-national U.S. citizens”.  It is also critical to notice that in the case of a problem with the government China does not recognize dual citizenship, which could result in problems with remaining/leaving the country.

Once one has resolved any matters with legal entry and remaining in China, one should observe what the region has to offer in terms of medical treatment.  China in general is, “are not equivalent to those in the United States.”  While medical facilities are not on par with those of the United States, they do have “Medical facilities with international staffs” in major regions, in particular, Beijing.

Beyond entry and health, starting up a business in China has just as much if not more regulation to be concerned with.  Those who are looking seriously to live in a foreign region for the sake of starting a new business or moving a business should do thorough research for up to date rules and laws within the People’s Republic of China.  One good source for this would be  the China business handbook.

By – Domenic Gabriella for ChinaExports.com

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Doing Business in China

Purchasing Business Insurance in China

There are all forms of risk when doing business in a foreign land such as China. To encourage foreign investment, the Chinese government does have establishments in China to offer ‘insurance’ on such ventures. There are also American enterprises that offer insurance when doing business in China.

The American offered insurance when doing business in China comes from the Export-Import Bank of the United States (Exim). The “…insurance program can be used to insure payment under unconfirmed letters of credit” (https://www.export.gov/china/exporting_to_china/GettingPaidforExportsChinaNov2009.pdf). This will protect the investor from the risk associated with the foreign bank.

China insurance for foreign investments has only been around the last decade. Insurance was established in China since 2001, “In compliance with the international practice on trade and investment promotion” (https://www.pri-center.com/documents/south_south/china07.pdf). The first insurance provider established by the rule was Sinosure. They’re major point of promoting foreign financing was “inbound investment insurance” https://www.pri-center.com/documents/south_south/china07.pdf.

One can also purchase insurance from within China. These policies can be purchased from any, “…agencies, brokerages, loss-adjusting companies and their branches” (https://www.circ.gov.cn/web/site45/tab2727/i38817.htm), that are approved by the China Insurance Regulatory Commission (“CIRC”). The CIRC regulates ALL insurances offered. It must “…examines and approves the establishment of insurance intermediaries” for them to be legal within China. This includes foreign insurances.

Apart from covering of foreign letters of credit, there is also insurance for covering equity in an investment. There are, however, more rules for such insurance under the ‘Law of the People’s Republic of China on Chinese-Foreign Equity Joint Ventures’. Article9 states that “…The various kinds of insurance coverage of an equity joint venture shall be furnished by insurance companies established within the territory of China” (https://www.npc.gov.cn/englishnpc/Law/2007-12/13/content_1384083.htm).

The establishment of insurance in China is an added incentive to invest into the Chinese market. While not all risk can be insured, and the purchasing is an extra cost, it does allow one to invest with much more security into a new market.

By – Domenic Gabriella for ChinaExports.com

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Doing Business in China

Local Help Starting A Business In China

There are many hurdles to doing business in a place like China.  Businesses from the U.S. are at a disadvantage overseas because of rules and regulations from what one can purchase, to requirements to rent land and sell products within China.  One must also overcome transportation currency exchange, and language barriers.  In order to do all this, it is best for a company to hire a consulting firm with expertise in Chinese trade.

Well-known Consulting Companies

  • EMC Compliance Management
  • TUV America
  • Emerge Logistics
  • Approved Specialists, Inc.

Emerge Logistics Consulting

Emerge Logistics is known for providing US and European companies with high quality distribution operations support in China.  This company has a good grasp of China’s rules and regulations; enough to make a profit as an organization that stores, transports, and (most important to some), deals with the legal requirements of the Chinese government


Emerge Logistics Services

The major service Emerge offers is invoicing services.  Emerge is useful as a licensed trading entity. Emerge provides a local currency invoicing service that enables companies to forego setting up their own legal entity.  This allows business owners to ensure they will have all the needed certifications to do business in China with Emerge Logistics as “…the legal consignee for your inventory or warranty shipment to China”.

This consulting firm also offers storage and transportation of goods.  Having, reliable inventory management for people who need to store products they are planning to source from China is useful.  This saves one the need to get certification from the Government to rest land (this is difficult, as the person who allows you to rend will also need to get a certification from the government), as well as the cost of renting.  Taking care of both storage and transportation, Emerge Logistics can adequately “provide reliable, customer friendly, and web accessible order processing support for …purchasers sourcing from the China market.”

Emerge Logistics Fees

The cost for these services varies greatly.  It is dependent on the amount of product one is seeking, and the regulation and certifications needed for that product, Costs of storing and transporting the good also factor in.  There is no given listing of prices for these services online.  These services will not be cheap, considering it is safer and faster than getting all the proper certifications from the government, (also frees one from the cost of those certifications).

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Doing Business in China

Doing Business In China With Chinese Government Assistance

Foreign markets are a major part of modern business, both as markets for good and pools of untapped labor.  Ventures to booming countries such as China are becoming more and more common.  China, in an attempt to promote such movement of jobs, technology and foreign capital, established a national site to help connect foreign investors and businessmen to domestic businessmen who are ready and willing to do business.

The Chinese Commodity Net (CCN), is China’s site to promote foreign venture into China. This is a large tool, “…to help foreign buyers find Chinese suppliers and other business partners.” It allows members to narrow down general searches of a business by product.

There is no charge to using the CCN network to make business relations.  However, to use the CCN, one must register, inputting “detailed information of the product that you suppose to purchase from China.”

After one has filled in what they are looking for, the CCN will find possible matches.  The standard practice is, “…in 7-10 working days, we would provide 5-10 Chinese suppliers as your request”.  An example, one post is of a person by the name of Budi is looking for “ampere chart recorder with paper (will be used for oil field electrical control panel).”  Of course, any sensitive information is replied via e-mail by the administrators of the site, while other businessmen can reply personally to your post.

The Chinese Commodity Net is a national establishment established by the China’s Ministry of Commerce.  With all the varying regulations, enforcements and other variations from region to region of China, further information is greatly beneficial.  One could establish communication with an operating business from CCN to clarify any concerns, questions, and regulations.  Or one could pay for those who specialize in businesses that help businesses find connections in a foreign market.  There are no such free establishments by the People’s Republic of China that could be found.

Apart from visiting this site for promotion of trade partners, one should also visit the Ministry of Commerce site and search for specific regulation laws for particular products.  The largest one is the ‘China Compulsory Certification’ (CCC).

By – Domenic Gabriella for ChinaExports.com

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Doing Business in China

Foreign Business Investment in China

If you are contemplating investing in a business venture in China a good place to start researching the Chinese government’s requirements and rules for foreign investment is the website of China’s Ministry of Commerce.

The Ministry of Commerce offers helpful articles such as:

The articles are short, and therefore lacking in detail necessary to make decisions, but they do provide a useful starting point and overview of the process of doing business in China.

As in all matters of business – anywhere – it is wise to consult with experienced trade advisers and also with legal counsel informed in the intricacies of trade law, contract and the practices associated with doing business, successfully, in China.