In the Year of the Pig, Chinese companies are bound to face more regulatory pressure from both inside and outside China. Legal experts have seen the advent of the “era of compliance”. According to the findings of China Compliance Blueprint for 2017-2018, some 54% of state-owned enterprises and 35% of privately owned companies have general compliance policies in place. However, no more than 20% are equipped with both tailor-made third-party compliance management and due diligence policies. With lessons from some high-profiles cases, it is expected that corporate compliance management will reach a new height.
New year, more compliance looks into the key legal and regulatory issues this year. Foreign investment law will be a key legislative project for China as a strong signal of the country’s determination to further open up its economy. It is expected that the new law will apply pre-establishment national treatment and a negative-list management system to foreign investors.
China’s E-Commerce Law, which took effect at the start of this year, for the first time clarifies the responsibilities of e-commerce platform operators. Given that e-commerce is playing an important role in China’s economy, the new law certainly will have a wide influence on many businesses.
For the capital market, the most anticipated move in 2019 is probably the proposed establishment of the science and technology innovation board as a pilot IPO system different from the current A-share market. The new board is designed for innovative technology companies without an outstanding profit, and will adopt the registration-based listing regime.
This issue also features our annual China Business Law Awards, which are granted to both Chinese and foreign law firms that had the strongest performance in the past year. While market-leading firms continued their expansion both inside and outside China, smaller boutique firms were also gradually receiving market recognition and expanding their businesses from their niche sectors into other areas. Regardless of their size, many law firms have been exploring their own development model and philosophies. The market is becoming more competitive and diversified than ever before.
Certain adjustments have been made to the awards this year to reflect market trends. For example, in the practice areas and industrial sectors, we have added three categories: data protection and privacy; family wealth management; and fintech and blockchain. The number of winners in many categories has been increased from five PRC and five international law firms to seven firms each.
Picking winners from so many prominent law firms is always a difficult task. China Business Law Journal relies on nominations and comments mostly from corporate counsel and managers, as well as leading lawyers in the market, while other significant elements such as the law firms’ landmark deals or cases and internal development were also considered. We extend our sincere congratulations to all the winners.