Partner Thomas Tang Launched the Latest Research Report on Chinese Enterprises

In mid-2016, LexisNexis and the Chinese Company Legal Research Institute under the Legal Daily jointly launched 2016-2017 Chinese Enterprises "Go Global" Research. Partner Thomas Tang and Lawyer Tan Jie from JunZeJun Law Offices worked as the chief editor of the research report.

Lawyer Tang Gongyuan was invited to officially launch the <2016-2017 Chinese Enterprises "Go Global" Research Report> (hereinafter referred to as the "Report") at the Sixth Annual Conference of China Company Legal in Beijing, and introduced the findings of the Report.
 

The research issued questionnaires through meeting site and network platform, of which 160 valid questionnaires were recovered. Among them, central State-owned Enterprises ("central SOEs") accounted for 11%, SOEs for 16%, private enterprises for 55%, foreign enterprises for 14%, and Sino-foreign joint ventures accounted for 4%.

Compared with last year, this research has the following highlights:

1. Added research on "the Belt and Road" ("B&R") in the Questionnaire part, to conduct a fishing expedition to the investment plan and current situation of Chinese enterprises in the B&R countries;

2. Significantly increased the proportion of private enterprises in the survey, and conducted analysis through classification comparison according to the enterprise types, to achieve a more comprehensive understanding of the difficulties and disputes Chinese enterprises encountered during "Going Global";

3. Organized rounds of roundtable discussion and face-to-face interviews among General legal counsels and managers of large-scale central SOEs, SOEs and private enterprises, to share and discuss their successful experience and lessons on "Go Global" and provide guidance and reference for other "Go Global" Chinese enterprises;

4. Regional research on key issues: Based on the risks identified in the previous year, selected keys issues to conduct regional risks analysis and identified the geographical distribution characteristics of different risks.
 

The "Report" found, the investment of Chinese enterprises in the B&R countries at the current stage, mainly showed the following features: SOEs and central SOEs are still the main force and leader of the investment in the B&R countries; more than half of the enterprises started investment on the B&R projects from the most recent three years; marketing factor such as "to open up the product/ business international market, occupy the local market, improve global market share, increase profitability" is still the first motive for the investment in the B&R countries, followed by the government policy.

Regarding the investment field of the Chinese enterprises in the B&R countries, the investment of the central SOEs and SOEs questioned is still focusing on the traditional industries, while the private enterprises' distribution of investment on traditional and new industries is more balanced, which plays a supplementary and enhancing effect on the investment of central SOEs and SOEs. Political instability, unsound legal and business environment and the difficulty of information collection are the first three major problems Chinese enterprises encountered. Private enterprises are also facing difficulties in foreign exchange import and export. From the investment evaluation perspective, the respondents' comment on the investment as a whole tends to be positive, and the positive comment will increase with the investment period extension.

In addition to the investment in the B&R countries, the Report also had a profound analysis and interpretation of Chinese enterprises' current investment situation globally.

Partner Tang pointed out, based on the research data and practice observation, Chinese enterprises should cultivate a "top-down" culture of compliance and establish the compliance system and risk control mechanism; increase the upfront investment to well prepare investment plans and risk assessment; pay attention to the enterprise social responsibility and the maintenance of community resources; and, attach importance to the design of dispute resolution mechanism.