It's time we started to break China

Oct 18 2006 By Damien Charlton, Partner In Ward Hadaway'S Business Services Team, The Journal

Trying to break into new export markets presents our region's businesses with many challenges. However, the opportunities presented by the spectacular growth of the Chinese economy are impossible to ignore.

China is now the fourth largest economy in the world, and its growth rate for 2006 is expected to exceed 10%. Over the past few years, China has experienced an unprecedented growth in trade volumes, and is now the European Union's largest trading partner after the US.

China is not just a source of cheap manufacturing.

Domestic demand from within China is soaring for a range of goods and services, including machinery, vehicles, chemicals and plastics, and as levels of prosperity rise, consumer products.

This means that although China has a large trade surplus, it also imports a huge amount each year.

The Chinese economy is being progressively deregulated and as a consequence the opportunities for doing business there are becoming more attractive.

But many questions remain for North-East businesses as to how they should go about breaking into this market.

One of the first legal questions raised by UK businesses generally relates to protection of intellectual property rights in a country that has become notorious for counterfeit goods.

While accession to the WTO has gone some way to bring China into line with western concepts of IP protection, this issue still needs careful consideration by any business thinking of doing business there.

Furthermore, Chinese legal requirements are very different to our own, with a constantly shifting array of regulations that must be complied with before trading can commence.

If you decide to take advantage of the local knowledge of a Chinese joint venture partner, questions arise as to how the venture should be structured to monitor and protect your interests in the shared venture.

Expert tax advice is also required as to how to structure your investment, and how to repatriate your profits in to the UK in the most tax efficient manner.

To help unravel the mysteries of doing business in China, Ward Hadaway has teamed up with RTC and Deloitte to provide a service that encompasses legal, tax and business consultancy, to guide you from devising a strategy for international growth, through to implementing the legal structure that best protects your interests within an efficient tax structure.

As part of this collaboration, Ward Hadaway has also linked up with one of China's leading law firms in order to provide its clients with the sort of local legal expertise that they will need in order successfully to do business there.

• Ward Hadaway is hosting a seminar at its offices on Newcastle Quayside on November 7 at 4pm with RTC and Deloitte about Doing Business in China, to register please contact Claire Douglass on: (0191) 204-4028 or email claire.douglass@wardhadaway.com.