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China recently made sweeping changes to its Consumer Protection law. The changes mark the first time that the law was modified in two decades – brought on by what the Chinese government calls “changes in the makeup and challenges of the consumer sector.”

According to an article by Reuters, the new laws “increase consumer powers, add rules for the booming internet shopping sector and stiffen punishments for businesses that mislead shoppers.”

The true purpose of the revisions, according to the article, is so that China can further move its economy away from one that is built on investment-driven growth, and transform it into one that’s led by domestic consumption.

Consumption contributed to just 45% of China’s economy during the beginning of 2013, which is down from about 60% during the same period last year. The Chinese government hopes that these new law is going to allow consumers to purchase Chinese products with increased confidence.

The new revisions will also strengthen the role of the China Consumers’ Association, which sometimes acts as a representative for plaintiffs in class action suits brought against retailers.

To read more, you can read the article from Reuters here: China Overhauls Consumer Protection Laws

Check out some related articles by IPG Legal here:

  • Import Duties & Taxes in China: The Wine Example
  • How to Succeed in Business in China
  • Another Reason for Establishing a Company in Hong Kong for Entering the Chinese Market
  • China May be Deep into a Bubble According to the Financial Times

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Chinese delegation visited the port city of Gwadar, Pakistan. The Chinese government has invested USD 250 million over the past decade to develop the port, which it will eventually control through a government consortium called the China Harbour Engineering Company. The port isn’t fully operational yet, but Chinese media’s willingness to report on the issue may be a signal that the port may finally transfer to Chinese control soon. Pakistan’s government has also publicly made it clear that it would like to hand control of the port over to China within one month.

The port is of extreme geographical significance to the Chinese, who have over the past ten years begun to flex their muscles and expand their influence far beyond their own borders. China is developing ports throughout South Asia – something often referred to as China’s ‘String of Pearls.’

For example, in July of this year, China outbid India to secure the rights to upgrade Chahabar Port, which sits in southeastern Iran along the Strait of Hormuz. And, in early August, Sri Lanka opened a Chinese-developed port at a total cost of USD 500 million. In total, China operates 15 ports in foreign countries, with most of them in Southeast Asia.

Gwadar offers China a chance at quicker oil acquisition from countries exporting through the Persian Gulf. China is the world’s largest consumer of Middle Eastern oil, meeting nearly 60% of its total energy needs from energy exports shipped through the Strait of Hormuz. After clearing the Strait, the oil must then be shipped east through the Indian Ocean, then slowly ferried through the Strait of Malacca (the narrow coastal throughway between Malaysia and Indonesia). Finally, it arrives at its destination through various ports in east China. The oil’s journey, from start to finish, is long and, often, prohibitively expensive.

The port at Gwadar would also give China something it desperately needs – a viable energy conduit that is completely free from a potential American naval blockade. Control of the port would allow the Chinese to ship their oil through the Strait of Hormuz into Gwadar, and then use overland transport to travel northeast through Pakistan. Once at Islamabad, the route will then use the also-Chinese-developed Karakoram Highway, and travel through the K2 mountain range, the second highest in the world, which lies adjacent to the Himilayas. From there, it will travel through the Pakistan-controlled Kashmir province of Gilgit-Baltistan, and will, finally, cross the Chinese border and be sent to Kashgar, a former Silk Road city located in western China’s Xinjiang Province. China has recently spent upwards of USD 18 billion to further develop roads in Gilgit-Baltistan to facilitate this process, and Kashgar is regularly the recipient of Chinese infrastructure investment. This all sounds good on paper, but the reality of transporting high profile soft targets, such as oil, through Pakistan is not as simple as our Chinese friends may think.

Gwadar sits in one of Pakistan’s most unstable provinces – Balochistan. Balochis are a fiercely independent people who are ethnically related to the also-fiercely-independent Kurds. Balochistan sees regular violence against representatives of the Pakistani government and foreigners (often Chinese). Balochis have an extensive list of grievances against the Pakistani government and do not like being ruled from Islamabad. Their situation has even attracted the attention of the U.S. Congress which, in light of China’s attempt to circumvent an American-dominated Pacific Ocean, considered a resolution in 2012 that was to suggest the funding of Balochi separatist groups. News of the resolution led to protests in both China and Pakistan, with the usual complaint that the U.S. was interfering in each country’s internal affairs.

China insists that there is no cause for alarm, and that their ‘String of Pearls’ is designed to support Chinese commercial interests, and nothing more. They have, for some time, maintained the position that India and the United States are locked in a ‘Cold War mentality’ that sees Chinese overseas ports as playing a threatening host to the People’s Liberation Army Navy (PLAN), as opposed to friendly outposts that exist solely to import/export manufactured goods. As we know, China, colonized in its past, increasingly plays the role of an international victim and regularly points its finger at Western countries for what it calls repeated attempts at limiting its outwardly-focused posture.

It’s anybody’s guess, at this point, as to China’s true intentions, but history has shown that great empires need not be built on military conquest alone. The British Empire was founded almost entirely on the establishment of overseas commercial interests – only later, when those interests were threatened, did the soldiers come. China is rising and, therefore, will begin to butt heads with those who have already risen.

But, for the sake of argument, must the Chinese have a martial mindset at the outset to be accused of doing what they are, in fact, doing? When is a counter by India or the United States, thus, warranted? I think that there needn’t be a sinister ‘master plan’ if it leads to the same result as a well-intentioned one. Chinese expansion, hostile or not, arouses great fear in India and well-founded concern in the United States. Throughout history, and in every corner of the world, countries have balanced each other, re-balanced each other, and re-balanced each other yet again. This game of ‘balance and re-balance’ plays out even between allies – how much more so must it play out between rivals? Therefore, just as Chinese expansion may not be inherently hostile, China should not consider other countries’ attempted checks on that expansion as inherently hostile either.

By seeking to avoid a rival’s check on its security through development of an overland energy route, China is acting in its best interests, and therefore doing exactly what it is supposed to do – India and the United States will do likewise, and so the world turns.

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American Bar Association’s Section of Intellectual Property Law has an interesting article entitled: Managing Trademark Investigations for Nonuse in China. The article may be found at the July/August 2013 Landslide Magazine Site.

The article notes that:

“In sum, one should expect to pay more but get less in terms of quality from trademark investigations in China when compared with their U.S. counterparts. As trademark practice improves in China, and as competition among investigation firms increases, we can expect quality to improve and prices to drop. In particular, if the Trademark Amendment Laws are enacted within three years of nonuse disqualifying the trademark owner from claiming damages for infringement, investigations should become even more routine.”

The article is recommended for those in need of guidance before retaining an investigator and, also, for attorneys that work with these investigators.