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China trade – never time to relax

Most of the world is applauding the recent thaw in relations between China and the US for good reason. A trade war doesn’t help anyone in the long run. More importantly, many US businesses have a stake in the Chinese economy now, as do more and more entrepreneurs.

There was a reward for everyone who held on through the storm, showing that doing business right in China can be lucrative. A key part of that is carefully complying with regulations and laws while building relationships.

What is new

The trade war was averted because both nations have a lot to gain by trading with each other, just like the entrepreneurs at the center of so much international business. But a victory by the US in many ways actually makes things a bit more tricky for companies operating in China in some ways.

One of the main sticking points between our nations is the uneven enforcement of regulations. The most contentious is always intellectual property – copyrights, trademarks, and patents. But the problems are not limited to this at all.

Products traded with China often do not meet quality specifications or other regulations. It may surprise you to find that this works both ways, and that China has also complained of problems.

New enforcement in China may make for good headlines, but it can create headaches for businesses. Additional scrutiny is being reported in many areas as a part of improved Chinese compliance. This is what was necessary to avert a trade war, so it has to be expected and embraced.

What you can do

There are two strong foundations for doing business in China. The first is always building relationships with people and institutions, developing a personal sense of trust. The second is a strict compliance with the law even when it seems that Chinese companies are a bit loose in that regard.

These are two signs of the same coin, in that your image as being completely legitimate is critical. It may seem unfair in that the law appears harsher to Americans, but that is simply how it is.

How to make it work

There is never any substitute for clear advice on the legal processes and procedures before setting up your business in China. Whether it is an import-export firm, a manufacturing plant, or a retail venture you will need to have your operations set up for perfectly transparent compliance.

The potential rewards for doing things properly are large, so it is worth the hassle. Doing business in China is not something for the faint hearted and it is never a way to turn a quick buck. But for those who are in it for the long haul and are willing to do it properly the potential rewards are there.

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