As The Wall Street Journal jarringly reported last month, the wages for manufacturing jobs in China and the United States are starting to converge. The trend undercuts the outsourcing of manufacturing, at least to China, and we’ve seen something of a revitalization of the U.S. manufacturing sector as a result. The upshot for your business: It may be time to stop looking to China for workers and start looking there for customers.
High Street Partners Offers Command and Control Solutions for Companies Operating Overseas
July 24, 2013 – (Boston/Annapolis) – The arrest earlier this week of several China-based GlaxoSmithKline employees on charges of bribery has heightened concerns for foreign companies operating in China. HQ is generally tasked with the development and oversight of robust controls to ensure that inappropriate cultural norms don’t run afoul of increasingly tougher regulatory environments, in China and elsewhere. According to statements issued by the pharmaceutical giant, the employees in question “appear to have acted outside of our processes and controls.”
"The news that healthcare giant GlaxoSmithKline had several of their executives arrested in China is a sobering reminder to all multinationals, large or small, on the need to ensure due command and control on their overseas operations" says Larry Harding, Founder & CEO of High Street Partners.
By Nick Hart, Director, Advisory Services
If you’re a business with overseas operations, chances are you’ve had experience dealing with the intricacies of Value Added Tax (VAT). If your business has already set up shop in China, you’re probably in tune with the China VAT Reform Pilot Program and the impending August 1st nationwide rollout of VAT in certain commercial sectors.
Foreign talent will soon be eligible for China visas valid for up to five years, under a draft regulation
Expensive tax implications if non-resident activities, including secondment arrangements, are found to constitute Service PE
“At-a-glance” developments from various jurisdictions
Back by popular demand: “At-a-glance” developments from various jurisdictions
China’s tax systems are some of the most complex in the world. Regulations change at a rapid pace, so if you’re doing business in China or planning to take the leap, make sure you have good advice and systems in place for keeping up with the regular release of important information.
Is expansion to China in the cards for your business? Recent economic and legal reforms have led to dramatic change in the nature of the Chinese business environment, providing huge market potential and major revenue opportunities for foreign investors and privately owned companies worldwide.
Beijing-based entities should be aware of their employer obligations regarding the establishment of trade unions and the Trade Union Reserve Fund.