Adapt and evolve

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Following the COVID-19 outbreak, past ways of working and living are gone forever. Having suffered the worst of the pandemic, some regions are resuming work and embracing the “new normal”, and China is among the first countries to do so. Much of this issue concerns the roadblocks and challenges thrown up in these troubling times, and how businesses and the legal community must rapidly adjust their tactics – or fall by the wayside.

coverAccording to the Ministry of Industry and Information Technology, as of 15 April, 84% of small and medium-sized enterprises (SMEs) and 99% of sizeable industrial enterprises had reopened. However, due to an unsynchronized situation at home and abroad, the decline in external demand and disruption of supply chains are becoming new threats to China’s economy. Businesses restarting after the pandemic-induced pause are also facing legal problems.

Our cover story, Over the peak, explores the tough issues facing enterprises that are reopening. Obstacles surrounding supply chains, arising from the trend of deglobalization, data security and privacy compliance during remote working, and contract performance under high uncertainty are among the challenges. General counsel and senior practitioners share their experiences, and provide analysis and insight into what lies ahead.

Many Chinese entrepreneurs view bankruptcy as negative, but in countries where the regime is relatively mature, such as the US, bankruptcy protection or restructuring is an accepted concept and a process in which some enterprises can shake off old burdens and start again.

Under the dual impact of an economic downturn and a pandemic, the number of bankruptcy filings in China is expected to further increase. So, what are the escape hatches for companies in dire financial condition? How do the parties in a bankruptcy proceeding secure their own rights and interests? And what are the investment risks and opportunities in bankruptcies? The point of return looks at the latest developments in bankruptcy and restructuring in China.

Mainland China has long been one of the world’s leading manufacturers of healthcare products, and the demand for medical equipment has skyrocketed amid the global pandemic. However, the rush of demand has exposed buyers to compliance and quality risks. In New challenges of medical sourcing in China, Rosie Hawes, a partner at Control Risks’ compliance, forensics and intelligence practice in Greater China and North Asia, offers advice on how to avoid procurement pitfalls with case studies.

Chinese stocks previously listed in the US face tougher regulations amid the accounting fraud of Nasdaq-listed Luckin Coffee, and heightened trade tensions between the US and China. Meanwhile, Shanghai’s A-share market and Hong Kong have updated their listing requirements and rules, paving the way for the return of these Chinese enterprises. The homecoming assesses the various types of transactions involved in this process from senior practitioners operating in different jurisdictions.