Got a call the other day from an American company wanting to sell its food products into China. And fast.

The problem this company is facing is that one cannot “just” sell food into China immediately. To sell food legaly into China, Foreign companies must first pass certification before China’s General Administration of Quality Supervision, Inspection and Quarantine, better known as AQSIQ (中华人民共和国国家质量监督检验检疫总局). The food company told me that its research had revealed that it typically takes around a year to secure this certification, but that someone in China was promising they could do it in “around six to eight weeks.”

The food company was calling me (based on a referral) to hire us to secure their certification in “six to eight weeks.” My response was essentially as follows:

If your research is telling you that it typically takes a year, there is absolutely no way we can do it in eight weeks. Maybe we can do it in ten months, but that would only be if absolutely everything goes our way. In fact, we do not even do this sort of work because there are plenty of really good companies that do nothing but assist foreign companies in securing AQSIQ certification and you should contact some of those. You do not need a lawyer for that; you just need someone experienced and honest.

As far as the company that is claiming to be able to get your AQSIQ approval in six to eight weeks, RUN away. And fast. That company is doing one of two things and neither will be good for you or your company. It is either paying bribes or it is going to fail.

If it is paying bribes, you are paying bribes because it is your agent and let me tell you, if the Feds sue you for an FCPA violation, I’m not going to want to be the lawyer to stand in front of the jury and explain how you had no clue that the extra fees you were paying this company was going to be used illegally to speed up a foreign registration.

Let’s just say this company succeeds and you jump to the front of the line and get your AQSIQ certification. Do you want to always be at risk of having Beijing pull your AQSIQ certification when it finds out what happened? I don’t know what the chances of that are, but I know they are considerably higher than zero.

If that Chinese company is not paying bribes, my worry is that it will simply pocket your funds and dissappear. Trust me when I tell you I have heard many stories about this sort of thing and companies that offer to pass on bribes are prime candidates for stealing. Or, at best, it will succeed in about a year and just have all sorts of excuses as to why it took so long.

Retain a good company and do it right. Trying to cut corners just isn’t worth it. This holds true for doing business in China in all areas, not just AQSIQ.

http://www.chinalawblog.com/2013/01/doing-business-in-china-and-avoiding-jail.html

China's new immigration law, which will take effect on July 1, 2013, will impose stiffer penalties on those found to have violated it, the Philippine Consulate General in Guangzhou warned on Thursday.

In a statement sent by the Department of Foreign Affairs, the Consulate said the new immigration law provides particular attention to the so-called "three illegals" - illegal entry, residence and employment. Each violation is penalized with different and more severe penalty.

"Foreigners found illegally working in China may be subjected to a fine raning from RMB (renmibi) 5,000 to RMB20,000. Possible detention of five to 15 days may also be imposed for serious violations. Income acquired from illegal employment will also be confiscated. Illegal residents will be fined from RMB500 per day up to a maximum amount of RMB10,000, or imprisonment of five to 15 days," the statement said.

Under the new law, employers who hire foreigners without the proper permits and documentations will also be penalized.
The new law also provides fine and penalty of imprisonment to persons or organizations aiding foreigners in committing any activities defined under the so-called "three illegals."

The Consulate urged Filipino nationals affected by the changes in the immigration law to contact the Consulate for advice. The public is also warned about agents misrepresenting themselves as processors of exit visas for overstaying foreigners.

China has passed a new law stipulating that family members should pay regular visits to their elderly relatives, according to the government’s official website.

The ruling, approved by China’s National People’s Congress yesterday, is part of a package of amendments to the Protection of the Rights and Interests of the Elderly legislation and will come into force on July 1, 2013.

“Family members who live separately from the elderly should visit them often,” the law says, adding that “employers should guarantee the right to home leave in accordance with relevant regulations”.

The law mentions no specific penalties for those who fail to visit frequently, nor elaborates on what “often” means.

But it does state that if the rights and interests of the elderly are violated, they or someone on their behalf can seek official help or file a lawsuit.

The wide-ranging law includes clauses covering intra-family conflicts regarding support obligations, housing and assets.

It stipulates punishments for people who abuse the elderly, fail to support them and interfere in their freedom to marry.

The legal changes reflect the challenge China faces in dealing with an increasingly ageing society after three decades of limiting couples to a single child. (AFP)

In the amended draft of the Trademark Law considered by the 11th National People’s Congress Standing Committee at the end of December, it is put forward that efforts will be made to strengthen protection of the rights to exclusive use of trademarks, add provisions on punitive compensation, and raise the amount of compensation for infringement.

In view of the fact that currently the cost of protecting trademark rights is so high that often the compensation for infringement awarded to the right holder cannot offset the damages sustained, the amended draft has introduced a punitive compensation system providing that in serious cases of malicious infringement of rights to exclusive use of a trademark, the amount of compensation for infringement can be set at one to three times the amount of actual losses suffered by the right holder, the proceeds obtained by the infringer, or the licensing fees of the registered trademark. The draft also sets out that in cases where all the above-mentioned three bases cannot be established, the court can at its discretion raise the maximum statutory compensation amount from Rmb500,000 to Rmb1 million.

Moreover, the draft has increased the types of registered trademark infringements which are legally liable. The draft provides that any acts of deliberately facilitating infringement and assisting other parties in infringing the exclusive right to use a registered trademark constitute acts of trademark infringement.

To maintain market order for fair competition, the draft has added provisions prohibiting acts of “free riding on brands” and malicious trademark registration. Such activities have been rife in recent years.

With such cases as the iPad war between Apple and Proview, trademark preemptive registration of Lin Shuhao (Jeremy Lin), and NBA superstar Michael Jordan’s lawsuit against Qiaodan Sports Co Ltd (the Chinese characters for “Jordan” and “Qiaodan” are the same), trademark infringement has become the focus of attention recently.

To prevent malicious trademark preemptive registration, the draft prohibits the preemptive registration of trademarks by people who have knowledge about the prior use of the trademark through business dealings. The draft also stipulates that no approval will be given to any application for registration of trademarks which are already in use and the applicant has knowledge about the prior use of the trademark through having a contract, business dealings or other relations with the trademark holder.

To address the act of “free riding on brands” whereby people use other people’s trademark as their enterprise name, the draft provides that such cases, which mislead the public and constitute unfair competition, will be handled in compliance with the Anti-Unfair Competition Law.

According to statistics, up to the first half of 2012, the cumulative number of trademark applications in China topped 10.54 million, the cumulative number of successful registrations reached 7.17 million, and the number of valid trademark registrations was 6.09 million. All these figures rank first in the world.

China’s Trademark Law underwent two rounds of amendment since it was first promulgated in 1983.

http://china-trade-research.hktdc.com/business-news/article/China-Investment-Environment/China-to-revise-Trademark-Law-to-raise-compensation-for-infringement/bacn/en/1/1X3A3JLU/1X09R0HJ.htm

China's legislature on December 28, 2012 passed new regulations requiring that new users who sign up for Internet services, including popular social networking websites, and landline and cell phone service, register using their real names. Network service providers -- that is, wireless carriers and ISPs (Internet service providers) are charged with collecting the information from users. 

Under consideration to help enforce the new law is the idea of having users in China register with ID card numbers. 

The Chinese state news agency, Xinhua, said that the measures were passed to "enhance the protection of personal information online and safeguard public interests." Xinhua also stated that as of November, 70 percent of mobile phone users had already registered with their real names. 

http://livewire.talkingpointsmemo.com/entry/china-passes-law-requiring-real-names-for-internet

The Standardization Administration of China (SAC), the standards organization governed by the State Council, has released the Regulatory Measures on National Standards Involving Patents (Interim) last month to seek comments from the public.

Below contents are the detailed articles.

Regulatory Measures on

National Standards Involving Patents (Interim)

(Draft for Public Comments)

I               General Principles

 1             These Measures are formulated to appropriately deal with the issues of national standards which involve patents, to regulate the management of national standards, to encourage innovation, to promote the rational adoption of new technologies by national standards, to protect the legitimate rights and interests of the public, patentees and relevant right holders, and to ensure the effective implementation of national standards, pursuant to the Standardization Law of the People’s Republic of China, the Patent Law of the People’s Republic of China, the Regulatory Measures on National Standards, and other relevant laws, regulations and regulatory measures.
2              These Measures are applicable to the handling of patent-related issues during the formulation or revision and implementation of national standards.
3              The term ‘patents’ as used in these Measures includes active patents and pending patent applications.
4              Patents involved in national standards shall be essential patents, which would be required to implement the standards.
5              The department of standardization administration under the State Council is not responsible for identifying whether national standards involving patents, not responsible for verifying the authenticity of materials submitted by patentees/patent applicants, and not responsible for identifying the validity of patents involved in national standards and the scope of claims of patent applications.

II             Disclosure of Patent Information

1              Organizations or individuals participating in the formulation or revision of national standard shall timely disclose to the technical committee or the responsible entity the essential patents known to them, and provide patent information and corresponding verification materials thereof.
2              Organizations or individuals who have not participated in the formulation or revision of national standard, and yet have knowledge of patents essential to the standard, are encouraged to notify in writing such information to the relevant technical committee or the responsible entity at any stage of the formulation or revision of such standard.
3              When the department of standardization administration under the State Council publishes information regarding the initiation of national standard project proposals, it shall publicize information on patents involved therein submitted by the technical committee or the responsible entity.
4              Organizations or individuals participating in the formulation or revision of national standards shall be legally liable for their failure to follow the aforementioned requirements to disclose the essential patents held by them.

III            Patent Licensing Declaration

1              During the formulation or revision of national standard involving patents, the technical committee or the responsible entity shall timely obtain the patent licensing declarations from the patentees/patent applicants.
Such declarations shall include one option selected by the patentee/patent applicant from the following three options:
(1)The patentee/patent applicant is willing to license to any organization or individual, free of charge, and on reasonable and non-discriminatory basis, to practice his/her patent when implementing the national standard;
(2)The patentee/patent applicant is willing to license to any organization or individual, on reasonable and non-discriminatory basis, to practice his/her patent when implementing the national standard; or
(3)The patentee/patent applicant is not willing to license pursuant to either one of the aforesaid options.
2       If option (3) is chosen by the patentee/patent applicant, the standard shall not include any provision based upon such patent.
3              When submitting national standard involving patents for approval, the technical committee or the responsible entity shall provide patent information, corresponding verification materials and patent licensing declarations. Draft national standards involving patents but with no corresponding licensing declarations shall be put on hold and shall not be authorized for publication.
4              [Licensing Declaration] Whereby a published national standard is found involving patents but with no licensing declaration after its publication, the department of standardization administration under the State Council shall instruct the technical committee or the responsible entity to obtain patent licensing declarations from the patentees/patent applicants within the stipulated time, and report to the department of standardization administration under the State Council. Whereby the patentees/patent applicants refuse to make the aforesaid licensing declaration, the affected national standards shall be suspended, and the department of standardization administration under the State Council shall instruct the technical committee or the responsible entity to revise such standards.
5      When patentees/patent applicants transfer or assign patents which the patentees/patent applicants have made licensing declaration to the technical committee or the responsible entity, the patentees/patent applicants shall have the assignees or transferees agree to be bound by the above license declaration.

IV            Special Requirements for Mandatory National Standards Involving Patents

1              In principle, mandatory national standards shall not involve patents.
2              Whereby a mandatory national standard indeed must involve patents, the department of standardization administration under the State Council, the department of patent administration under the State Council, relevant departments and the patentees/patent applicants shall jointly negotiate a disposition resolution. Whereby agreement with respect to the patent disposition is unable to be reached, such national standard shall be put on hold and shall not be authorized for publication.
3              Before allowing the publication of a mandatory national standard which involves patents, the department of standardization administration under the State Council shall publish the full text of the standard and the known patent information for a period of 30 days. Any organization or individual may notify the department of standardization administration under the State Council in writing additional patent information known to him/her.

V             Supplementary Rules

1              Whereby identical adoption of an international standard developed by the International Organization for Standardization (ISO) and the International Electrotechnical Commission (IEC) as a national standard, the licensing declarations made upon the patents involved in such international standard are equally applicable to the national standard. In all other situations of adopting international standards, I, II, III, IV of these Measures shall be followed.
2              During the formulation or revision of national standard involving patents, the specific disclosure of patent information and patent licensing declaration shall follow the requirements set by GB/T “Special Procedures for the development of Standards Part 1: Standard Related to Patents”.
3              The compilation requirements for patent information in the text of national standards shall follow the rules set by GB/T 1 “Directives for Standardization”.
4              The formulation or revision of sector standards and local standards involving patents may refer to these Measures.
5              The power to interpret these Measures is vested upon the department of standardization administration under the State Council.
6              These Measures shall put into effect as of DD/MM/YY.