China, Vietnam, Thailand and Spain: What Would Goldilocks do?

Got two emails this morning that were similar and yet could not have been more different.

They both were in response to yesterday’s seemingly neutral blog post The 101 on Overseas Manufacturing Contracts (OEM, CM and ODM), in which we talked about what should go into your manufacturing agreements around the world, and did not mention China even once (other than in the form of one link to a previous post).

The first email I read was the following, from a self-described “China consultant who has been living in Shanghai for the last seven years” and “resents” how we are “lying about the situation on the ground in China because we are “hell-bent on bad-mouthing China at every opportunity.” This person said: “I see what you did with yesterdays’ blog post and I see what you have been doing for the last few months. You are trying to scrub China from your blog and I know why you are doing this and I resent it.” He went on to accuse us of bad-mouthing China to “build up” our business “in Vietnam and Thailand and everywhere but China.”

The second email was from a lawyer who “spent six years in Thailand and 11 years in Taiwan” and “very much appreciates” our writing about countries other than just China and suggests we change our blog’s name to “International Law Blog.” He especially wants us to write more about the EU and Spain because his “life-long dream is to live in Malaga.” I responded to him by saying that even though we write an incredibly widely read blog about China, we get 1-3 emails every month from someone writing to tell us for a job with us in Spain because it has been their dream to live and work there but I do not recall having ever gotten an email (at least not for many years) that contained “dream and China in the same sentence.”

Both of these emails our essentially challenging us to take the “correct” path going forward.

Okay….

We get it. Trust us, we get it. And hardly a day goes by without our China Law Blog team of international lawyers (note how I said international lawyers and not China lawyers) think about these sorts of things, email or no email.

These sorts of emails have become fairly typical since the start of the US trade war. Hardly a day goes by without our receiving an email from someone who is absolutely furious about our not speaking about China in consistently exalted terms or an email from someone pushing us to broaden the blog beyond “just China.”

This morning I went back and read our blog’s Mission Statement, written on our very first day in the China blogging biz, way back in January, 2006, and barely revised since then. It reads as follows, with the key sections highlighted (just now):

Why are we doing this?

What exactly will we be doing?

There are more than 4 million blogs. Many of these are about China, including some very good ones. Some of our favorites include Talk Talk China and Simon World for general China information, The China Stock Blog for Chinese stock market information, China Tech Stories for information regarding China’s technology sector, and Journey Around China for travel information.  [3-6-2012 Update: None of these blogs still exist so we removed the links]

There is even a superb Chinese law blog, The Chinese Law Prof Blog, but it has a distinctly academic bent and we will not.

We will be discussing the practical aspects of Chinese law and how it impacts business there. We will be telling you about what works and what does not and what you as a businessperson can do to use the law to your advantage. Our aim is to assist businesses already in China or planning to go into China, not to break new ground in legal theory or policy. We want to start a conversation with, for and about the person who wants to know “what is what” in China and the practical aspects of starting and growing a business in or involved with China.

We are not writing for those who want to know more about Section (A)viii of a particular piece of Chinese legislation or the history of that act or the policy reasons behind it. Our site is not focused on the legal scholar or the China lawyer.

We want to initiate a discussion regarding the changing laws in China. We will constantly be challenging the various misconceptions the West has about law in China, including that the law in China does not really matter or that guanxi can supplant it.

We will provide information to those who conduct business with or in China as to how they can use the law as both a shield and as a sword. We will give you our insights to achieve practical solutions, while doing our best to entertain.

We know lawyers are not popular, and though we are ourselves really quite likable, we recognize the need to avoid those things that incite lawyer hatred. In other words, we will strive to avoid legal jargon and namby-pamby language that attempts to camouflage our views or to avoid controversy.

We want this blog to be a place for conversation and even controversy. We expect many of you will disagree with us much of the time and we do not care. We will always strive to avoid boring you or being unwilling to take a stand. We are not going to be afraid of being wrong — in fact, we want you to tell us when and how we are wrong. If you want “lawyer language” or long strings of caveats, you are going to have to pay exorbitant legal fees to get that elsewhere.

Though our focus will be on the interaction of law and business in China, we most certainly will be personalizing this page with our own experiences. We will tell you more than just that the law is this and this is what needs to be done to comply. We will discuss how the laws as written may say one thing, but our experience dictates something else. We will tell you when you need to do more than just follow the law to succeed and we will set out exactly what that something else is. We will estimate the chances for success if one does one thing as opposed to another. You will hear what we have done to succeed for ourselves and for our clients in China and you will hear about where we failed. We will regale you with stories about the Chinese lawyers with whom we work, the foreign and Chinese businesspeople with whom we deal, and even the places we go. There will be times where our lawyer ethical rules will make us unable to name names, but we will always work to tell the full story.

In addition to our discussions regarding what we are seeing on the ground in China, we will post articles and postings from elsewhere, to which we will, when appropriate, add our own comments. We will also post events, like seminars, conferences and trade shows, that we believe will advance our readers’ grasp of China law and business.

It has become a blog cliché to implore readers for their input, but it is so important we must join the crowd on this. We do not purport to know everything about Chinese law. That is impossible.  China is anything but monolithic and the differences in the legal situations between the various regions are no less pronounced than the cultural differences.

The strengths of our China attorneys who will be writing for this blog are in forming companies in China (WFOEs and Joint Ventures and Representative Offices, mostly), in drafting international contracts with Chinese companies (in English and in Chinese), in intellectual property protection, in technology licensing agreements, in media and entertainment, and in litigation. We welcome your comments, suggestions, and ideas on any area of law relating to doing business in China.

In plain language, we ask that you write us early and often. We will review your comments before we post them, but that does NOT mean you should not criticize us or disagree with us. Our review will be to filter out “comment spam” and comments that are without substance and/or are personally abusive. We want to encourage a high level of discussion but we will not ban or delete your comments just because you come after us — at least not the first few times.

So why are we doing this? The short answer to this initial question is that we are doing this to — in our own small way — advance the dialogue regarding Chinese law and business.

In summation then, our job is to always strive to tell it like we see it and that will not change. Well before we started this blog, our law firm did a huge amount of legal work with Russia, particularly with the Russian Far East. We represented a huge percentage of American and European businesses involved with the Russian fishing, timber and mining industries. These businesses dealt constantly with Asia (first mostly Japan and Korea) and then China and to a lesser extent Vietnam and Thailand, and it was on these countries that our international lawyers focused.

Eventually Russia became incredibly inhospitable to foreign businesses and I can remember after going on national television after one particularly egregious and large-scale and very public Russian asset seizure and being asked whether this would lead foreign businesses to start avoiding Russia and Russian businesses. My answer was (as best as I recall and I recall it quite well) something like the following: “Of course it will. How can it not? Any foreign company looking to do any business involving Russia now must ask themselves whether they too will get their assets seized. There is no way this recent action will NOT caste a pall on doing business with Russia.”

Before I had even stepped into the door at my office, one of our lead Russia lawyers — a lawyer from Russia and licensed to practice law in both Russia and the United States — was waiting for me ready to pounce: She quite angrily said to me “How could you have said what you said about Russia. You just destroyed our Russian business. What were you thinking?” I responded with something like the following: “I told the truth. There was no way I was going to sit there and act like this [asset seizure] was nothing. Two reasons: One, I am not going to lie. And two, had I lied, everyone who knows anything about Russia would have known I was lying or just thought I am a complete idiot. And for you to blame me for foreign companies being afraid to do business in Russia is ridiculous. It is not some stupid lawyer in Seattle [me] saying they will be afraid of doing business in Russia that will make them afraid. They will be afraid because of what Russia has done. Our only hope to keep up our business is to tell people the truth because if people think we are lying to them they will flee us in droves.

Our Russian business went into a free-fall because business with Russia went into free-fall, but nearly all our clients who stayed in business stayed with us as they moved their business to the rest of the world, and we represent many of them around the world today, including in China.

So yeah, all of us are going through great changes with China today and those changes are making many tense and uncomfortable and I get that. But we have always tried to avoid being China bears or pandas and we will continue with that. It’s just a lot easier for us to do our best to call things as we see them and let the chips fall where they may.

We really don’t have any other choice.

Oh, and at least for the immediate future, we have no plans to change our blog’s name but we will continue to write about what we think our readers want and need to know.

But what do you think? Are we being too hard on China these days? Too soft? Just right? Please explain.

We will be discussing the practical aspects of Chinese law and how it impacts business there. We will be telling you what works and what does not and what you as a businessperson can do to use the law to your advantage. Our aim is to assist businesses already in China or planning to go into China, not to break new ground in legal theory or policy.