Archive for the ‘Legal’ Category

The other day a law firm XYX from Sweden contacted us for an opinion on a car accident that happened to one of their clients in China.

Mike , together with his translator were on the way to a factory meeting somewhere between Jinan & Qingdao.

For this travel he booked a car for the day that would bring them from the safe confinements of the Jinan city walls into the the countryside 3 hours away. It was spring & farmers on the road were all getting into gear to tend to their fields.

Somewhere on a straight lonely country road bordered with trees,   the driver fell asleep…..& hit another car at 70km/h. Mike & the driver got badly injured, while the translator only got some minor bruises. It took another 3 gruesome hours before paramedics could tend to the injured.


With the assistance of his travel insurance company Mike was flown out of China 24 hours later.

After a revalidation period the insurance company asked Mike to get all papers in order to claim from the insurance of the car owner.

It’s here that our lawyers discovered that the 3rd party insurance for the car was only covered for an amount of up to RMB 10,000 (USD 1470 or Euro 1000). One can easily imagine that this was bearly enough to cover the cost of repatration & recovery at home…….. Now Mike is facing off with his insurance company…

An advice we’d like to give anyone renting a car for a long distance:

1) Make sure the car is in a new state or well maintained.

2) Preferably take a taxi driver for the day. they’ve got proper insurance & will hopefully drive with more skills. Or as an alternative mayby your business partner or friend can recommend a driver.

3) If possible try out the driver for a short trip before committing for a long distance journey.

4) Make sure the driver is well rested. Too often will a driver be at the wheel for 24 hours on end. Not really an ideal start of a long-distance trip.

5) In case you feel the driver is reckless, ask him to slow down or drive more carefully. If that doesn’t help, please ask him to stop & get out of the car. If you’re in the middle of no-where get off at the next city or village but GET OFF. Don’t be naive & think that accidents only happen to others.

I once had the bad luck that my faithfull driver couldn’t commit to pick me up at Beijing airport & sent someone else instead. I unfortunately disgarded the above rules ’cause

Two pretty ladies in miniskirt were driving a huge Jeep. On departure I already fell something was amiss. The driver lady never changed gear & stayed in 2nd the whole way…. At a speed of 40 km’h we traveled the 15 km highway into the city…..

While other cars were hurling past us at 120 km/h……. & nearly missed us on several occasions. Nobody was expected such a slow moving vehicle on the high-way.

Finally I asked the driver what was going on: She shily replayed that “she never drove a car before but because my ‘faithful’ driver had asked her for this favor she couldn’t refuse……”

So please try to be safe on the Chinese roads at all times !

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This blog has been blocked in China since today & I only started 4 days ago… ;(
Not really sure what’s going on. Content wise we’re China lovers so can’t really see where’s the problem.
Maybe some American Mole wanting to score some points…. Anyways I’m glad to see we’re back up and running through some proxy server.
But I assume it might, from time to time sputter to a stand still. therefore my sincere apologies if I can’t give you any feedback on the messages I receive.
As an afterthought I was rather hoping the book “Business Republic of China” would be banned. At least that would generate publicity & sales.
Meanwhile check out in bottom of this page for a lexicon made for the book Business Republic of China.
Or copy-paste this on your browser: http://www.blacksmithbooks.com/china_business_crib_sheet.pdf
Cheers !
Enjoy Business Republic of China

A concise lexicon for the unversed barbarian

Laowai: “Barbarian”, Most probably YOU !; Those who don’t belong to the inner circle of the Chinese community. The antidote could be Laonei; Laozhong .

Baijiu: Rocket fuel alias rice wine or another alcohol fermented concoctation

Guanxi: Relationships that oil the wheels of commerce.

Karaoke: Dark stuffy place of leisure to sing, drink and relax; sometimes also used as bonding tool during meals.

Panda huggers: Unconditional China lovers

Dragon slayers: Unconditional China haters

Old China Hand: A barbarian is crowned this way when a Chinese party requests/ in urgent need of a favor from him/her; a barbarian who happens to have lived for quite a while in the Middle Kingdom or an intrepid Sino-freak that unconsciously stumbles into this metaphor.

Tian An Men: Political center of China.

bamigoring, nasigoreng, lumpia and krupuk: Indonesian food. No relationship whatsoever with Chinese food.

Friendship: an allegory e.g. in “Friendship hotel”

Chongqing: Possibly the most beautiful & exciting city in the world, where the sun is shy, the air is intense and the dust tastes of adventure.

Sichuan: The mythical four-river province; The mother of all provinces; The promised land.

Face: Something one can loose or …. gain. The art of giving face is way more difficult than making one loose face.

JV: Joint-Venture; in China often turns into a Joint-Adventure because of cultural business misunderstandings between the Chinese and Western parties involved.

Language barrier: A daily occurrence between two different cultures.

Xiahai: “Jump into the sea” Basically giving up the safe confines of a job in a State Owned company and start one’s own private enterprise. This brand of jumping was extremely popular in the eighties and nineties.

Ganbei: When two or more glasses meet around the dinner table. “Cheers”, “Bottoms up”, “Schol”

Honored guest: Well it says exactly what it is: an honored guest no strings attached, unless the barbarian mind really wants to see ghosts of deception.

The sound of silence: A most valuable negotiation tool

Privacy: In China slightly different concept compared to the West.

Danwei: Work unit that besides a job also provided housing, schools and medical care. Till the economic reforms were well underway it would have been virtually impossible for a Chinese citizen not to belong to such a work unit.

RMB: Renminbi; Chinese currency, People’s money; Unit :Yuan;

The Long March: The heroic retreat of the communist leadership and 87,000 Red Army soldiers in 1934 while on the run from the grip of the Kuomintang army. One year later after 9000 km across rivers, through mountainous terrain, marshes and several battles they reached the Yan’an base in Shaanxi province. Less than 10,000 survived this perilous expedition; Name for a family of Chinese space launch vehicles.

Business with Chinese characteristics: The main reason why it’s so much fun and gratifying to sell equipment, source products or run a business in China.

Gong An: Public Security; Police; Often sitting in the office sipping tea & smoking cigarettes waiting to be pressed into action

Pinyin: Is the most commonly used romanization system of the Chinese characters in Mandarin (Hanyu Pinyin). But since this system was developed on the Mainland, Taiwan wouldn’t want anything to do with it. As a result chaos reins with Tongyong Pinyin,Yale, Mandarin Phonetic Symbols II and Wade-Giles fighting for attention on street signs and places.

Er nai: Modern day concubine. Often to be found in the presence of the successful and wealthy. In money terms a lot more costly to maintain than the legally wedded wife.

Liberation truck: Jiefang truck. The 1st truck built in the PRC and based on a Russian design. The 1st version can still be admired on the one fen note.

New China: After the founding of the People’s Republic of China on October 1st 1949, a reform movement was put in place to eradicate China’s old customs, superstitious beliefs, land ownership, inequality between women and men, illiteracy, prostitution, gambling, etc….and a New China rose from the ashes.

3Q: SMS phonetics for “Thank You” in Mandarin Chinese

Forbidden City: Residence of twenty-four Emperors from the Ming Dynasty till the end of the Qing dynasty. Based in the center of Beijing. Only the royal family, concubines, servants and eunuchs roamed this vast complex. The common man was allowed to enter on royal invitation only.

Zhongnanhai: A compound sitting next to the Forbidden City and fromwhere the Central Government rules the PRC.

Jiaozi: Chinese dumplings; Ravioli.

SEZ: Special Economic Zone. In China an area that provides investment incentives to foreign companies in the form of tax benefits, tax holidays and infrastructure. Presently those zones have lost much of their uniqueness, as only those investments encouraged by the Central Chinese government will receive this red carpet treatment. However with some help of the local government officials some of the local taxes might be waived.

Soft sleeper / hard seat: Take a hard seat on a train from Beijing to Chongqing. Feel, enjoy and become one with the masses. For the return journey, book a soft sleeper. Compare and understand.

Frog in the well: Probably the ugly green frog my publisher dreams of kissing and will with a bit of luck metamorphose into a rich and sexy princess.

‘To get rich is glorious’: Soon after Deng Xiao Ping articulated those words in the fall of 1992 to instigate economic reforms, millionaires started to pop up all over the country. Glorious yes but not always innocent or without risks.

Overseas Chinese: People born in China or of Chinese descent who live outside Greater China.

Greater China: PRC + Taiwan + HK + Macao

People’s Daily: Efficient propaganda machine & mouthpiece of the Central Government.

Underground bank: Bank located in a subway

Four modernizations: By the end of the seventies Deng Xiaoping brought forward a new socialist reform plan to modernize industry, science, agriculture and defense. An alternative to the centrally planned and command driven economy that had created much of the country’s political and social instability. This new revolution in turn kick-started the present day “economic miracle”. A new movement has meanwhile taken roots: “harmonious society”

Feng shui: Wind and water; An ancient Taoist practice of studying and following the natural currents/shapes of the Earth to ensure proper alignment with them so that “Positive Energy” is not disrupted.
If you’re in a desperate mood, a Fengshui master might assist in turning your unprofitable business back on track by: Putting your office furniture in the write position will stop the money flow out of the doors. Having the right amount and color of fish in your office aquarium will fend off business disasters, etc….

‘You do not understand China’: A mild form of coercion. Slip of the tongue; Too bad if someone tells you this. Try to keep your dented pride in check; He/She might know you better than you think. Often used during an argument, debate or negotiation.

Iron rice bowl: Symbolizes Lifetime employment, housing and social security in the centrally planned economy. For most, this bowl has meanwhile been broken by the labor market reforms.

Sea cucumber: Slippery sea creature that is part of Chinese cuisine. It’s flavorless, of rubbery consistency but said to have aphrodisiac capabilities.

SOE: State Owned Enterprise

Princeling: A well-connected son or daughter of a higher cadre in the Communist Party.

XO: Extra Old Cognac. An alternative to Viagra; A must drink for seniors thriving in Karaoke bars with the hope of impressing a babe or two. XO could be the foundations to build up an ernai relationship.

One billion customers: Part dream, part obsession, part nightmare

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The company chop is king in China. It basically means that in China a  company seal on a document has the same value as a handwritten signature acknowledging the contents of a contract in the West & turning it into a legal paper.

One of our customers faced an UFO (Unidentified Financial Obligation) because of sloppy handling of the company’s stamp. One of their employees, when (s)he got hold of the precious company seal ,turned a bit enterpreneurial & dutifully chopped a couple of blanco A4 sheets with the cherry red company stamp…… with the idea “To be used at a later date”. That “later date” turned out a couple of months later when (s)he got fired.

Shortly afterwards when the company owner thought everything was settled, a lawyer defending the employee turned up at the company’s doorsteps with a document that in short stated: “In case Mr/Ms xxxx is fired the company will be obliged to pay her/him a compensation equivalent to 2 years salary” The document back dated and duly signed by the employee next to the company’s red seal……….

Aliens in Beijing (Face Bar)

Since this company hadn’t specified anything in the company’s by-laws how legal documents should be signed off & by whom, the owners had no other recourse but to haggle a bit and ultimately pay up.


Many other variants of UFO’s turn up on companies’ desks & those alien to the significance of the company seal expose themselves unnecessarely to the legal concenquences this could have for the shareholders. Sadly enough those UFO’s can sometimes turn out to be a real & eminent threat to the going concern of the company.

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