Going Global with Bryan Cave: Navigating Asia Today Unlocking Opportunities and Understanding Risks for Global Businesses.

Size: px

Start display at page:

Download "Going Global with Bryan Cave: Navigating Asia Today Unlocking Opportunities and Understanding Risks for Global Businesses."

Robyn Lawrence
5 years ago
Views:

1 Going Global with Bryan Cave: Navigating Asia Today Unlocking Opportunities and Understanding Risks for Global Businesses November 29,

2 Presenters Nicole J. Simonian David R. Stepp Clif Burns

3 Agenda Introduction U.S. International Trade Agenda in the New Administration What impact will it have on Asia? Asia Inbound & Outbound Regulatory issues are changing and becoming more complex New China foreign investment regulations and currency controls Customs and E-Commerce Sanctions and Export Controls Anticorruption Cybersecurity 3

4 General Overview of U.S.-Asia Trade Outlook America First Free Trade Agreements TPP/WTO/Bilaterals How do changes affect a company s manufacturing platform? Vietnam as a case study TPP without the U.S. Increases in General U.S. Tariffs 4

5 General Overview of U.S.-Asia Trade Outlook Trade Remedies and Safeguard Actions Antidumping and countervailing duties Chinese goods targeted Global Safeguard investigation into imports of Crystalline Silicon Photovoltaic (CSPV) cells Government Procurement Buy America Act Sanctions/Anticorruption What s next? 5

China Trade Is Becoming Increasingly Complex INBOUND INTO THE U.S. New U.S. administration causes Chinese currency to fall against U.S. Dollar; Chinese investors looking for safe haven investments Increased interest in U.

6 China Trade Is Becoming Increasingly Complex INBOUND INTO THE U.S. New U.S. administration causes Chinese currency to fall against U.S. Dollar; Chinese investors looking for safe haven investments Increased interest in U.S. trophy properties Be careful of the Alphabet Soup OFAC, CFIUS, KYC OFAC Are investors on the SDN list? CFIUS Is the target strategically important to the US? KYC Understand how the money is going to be sent to the U.S. and plan for an operational U.S. banking structure especially timing 6

7 Enhanced China Currency Controls Enhanced Scrutiny on the Authenticity of Trading Transactions Stricter Scrutiny and Prior Approval for Certain Outbound Investment Restrictions on Dividend Remittance 7

China Trade Is Becoming Increasingly Complex OUTBOUND INTO CHINA New Chinese Foreign Investment Regulations overhaul ways M&A is done in China Before: Government approvals required for on-theground

8 China Trade Is Becoming Increasingly Complex OUTBOUND INTO CHINA New Chinese Foreign Investment Regulations overhaul ways M&A is done in China Before: Government approvals required for on-theground acquisitions of Chinese companies (WFOES/JVs). Now: Government notice filings, not true approvals are needed Uncertainties: what needs to be disclosed, government ability to comment, other new and uncertain items that can slow down or halt the deal Many other regulations still exist that can impact the deal Local labor/tax, customs/supply chain, anti-bribery 8

9 Broadened China Market Access and Incentive Policies Opening Up More Sectors to Foreign Investment Promotion of Fair Competition between FIEs and Domestic Companies Incentive Policies for Foreign Investment 9

10 Customs and Import Issues for Asia Trade Effect of America First policy on Asia countries import policies Possible retaliation for increased U.S. import tariffs, trade remedy cases, and safeguard actions Increased use of non-tariff barriers Increased prominence of China Trade facilitation is essential for the free flow of goods Free trade agreements are a key vehicle for reform Current patchwork of national laws with competing interests Example of challenges: trade in food products 10

11 China Trade Facilitation Reform & Customs Enforcement Trend Key Content of China s Trade Facilitation Reform New Customs Audit Regulations Enhanced Customs Enforcement on Royalty Payment and Related Transactions 11

12 E-Commerce E-Commerce is increasing at a rapid pace with different national requirements New Chinese regulations impact e-commerce businesses relying on mobile applications Qualifications requirement Obligation to verify and report relevant illegal information Real-name requirement Record retention obligation 12

13 New China Cross-Border E-Commerce Policy Key Changes to China E-Commerce Law Personal effects or commercial goods? Taxes Positive list Import license, CIQ and registration requirements Transition Period 13

14 Asia Sanctions and Export Control New Draft PRC Export Control Law U.S. Export Laws and Exports to China Export of all defense articles and services prohibited under USML. Unique restrictions under EAR on exports to China: Military end users/uses NS controlled items over $50,000 require MOFCOM end use statement; Excluded from use of License Exception STA; Higher US Customs scrutiny of exports to China (for diversion/misclassification). Sanctions issues: Some Chinese financial institutions sanctioned for activities with Iran and North Korea; Secondary sanctions on Chinese companies dealing with North Korea likely. 14

15 Asia Anticorruption Trends 15

16 Asia Anticorruption Trends China remains significant focus of anti-corruption inquiries Pay-to-prescribe schemes penalized SiClone - $12 million Bristol-Myers Squibb - $14 million Unlike other countries, China has little history of punishing officials who take bribes from foreign concerns; anti-corruption laws in China principally used against political opponents, e.g., Generals Zhang, Guo and Xu who took bribes to grant promotions. 16

17 New China Anti-Unfair Competition Law and Increased Commercial Bribery Risks Commercial bribery definition revised Increased administrative penalties Presumed vicarious liability for employees activities Expanded investigative powers 17

18 New China Cybersecurity Law and Enhanced Internet Regulation General Obligations of Network Operator Mandatory national and industry standards must be met Product security test and certification critical network equipment and special cyber security products Obligation to cooperate in criminal investigation Further Requirements for Critical Information Infrastructure Operator Storage of data in country Restrictions on cross-border data transfer Potential national security review Personal Data Protection Cross- Border Data Transfer 18

19 Questions? Nicole J. Simonian David R. Stepp Clif Burns

20 20

Going Global with Bryan Cave: Examining Trade and Regulatory Issues When Moving Goods and People Across Borders

Going Global with Bryan Cave: Examining Trade and Regulatory Issues When Moving Goods and People Across Borders June 24, 2015 Nicole Simonian Clif Burns David Stepp Evan Chuck 1 Selling Goods: Regulatory