Checking If You Are (Really) in Control of Your China Operations

These are applicable to smaller businesses; accordingly we have not gone into details on director?s quorums, shareholder rights and larger corporate issues in this overview. However, they very much do apply to business managers in any company, small or large. If you consistently find these are applicable to you, an internal management systems audit may be a good idea.

Legal control

One person holds all the company chops
If that person isn?t you, you have a potential problem. Either take possession or spread the risk by having different personnel responsible for different chops. Required chops (business seals) in China vary from function to function; it really isn?t necessary for one person to hold them all. It can cripple your business if that individual leaves under a cloud, or misuses them.

Who trademarked your brand?
Do you have the documentation showing that your company (or parent) owns your brand? If you didn?t mark it maybe you should ? and if it has been marked you need to establish who registered it and in what name. It is common for employees or even suppliers to ?take care? of your trademark or patent registration for you and then simply register it in their own name.

Business licenses are not immediately accessible
You should have immediate access to your business documentation upon request. Ideally, these documents should be contained within a company documentation manual, with translations of what they are next to them and identifiable expiration dates. If you do not have this under control your licenses can expire, have the wrong scope, or simply get lost. This can seriously impact your business operations if a problem arises.

To know more, the whole issue is available (after a free subscription) on China Briefing website with others archives
For more information on China’s legal and tax issues or to ask for professional advices in related matters, please write to info@dezshira.com

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