In-house counsel are not just legal experts, but are also equipped with extensive knowledge of their industry sectors. General counsel also possess expertise in team management and communication. Here we glean the opinions of three elite GCs from different industries, who share their observations and strategies
VP, General Counsel and Chief Compliance Officer of NIO
As China undergoes reform and opens up, industrial upgrades are happening across the real economy. Companies like NIO are exploring new energy sources and emerging from traditional industries. So how can companies secure an advantage during this transition? In-house counsel need to understand their industry, look beyond to the world, and quickly identify future trends.
Q: Can you tell us about the legal trends and challenges within the electric vehicle (EV) industry?
Liu Fang: I think the trends are good and bad. The good thing is, the electric vehicle sector is in the country’s 13th Five-Year Plan, so it is definitely a new thriving industry. But the bad thing is, we see the economy right now is still slowing down. Even though in the past several years, from 2011-2017, we saw a big expansion in the auto industry, we now see consecutively 15 months of a slowing down or decrease in the sales volume.
So right now, actually this year, I personally feel it is quite challenging, especially for electric vehicles, because of the slowing down of the economy.
As the decrease of sales volume impacts the sales of electric cars, the country has implemented some new regulations restricting new entries or new companies into this sector. It is also going to phase out the subsidies to customers purchasing the cars.
In terms of a regulatory change, I think there were two new laws implemented last year, which are, in some sense, helping this sector to grow. One of the regulations is called “The policy on investment of new electric vehicle industry”.
The other one is the guidelines on how to regulate this industry. In those two big regulations, I would say, are the guidelines for private investors looking into this sector. When they want to do certain investment activities in China, I think these two, policy and regulation, need to be looked at.
The interviews with Liu Fang and Shawn Zhao were conducted during the CBLJ Forum at Grand Hyatt Hotel, Shanghai, on 12 November 2019, with the theme “Seizing Cross-Border Opportunities – Managing Global Risks”.
The interview with Sara Yu was conducted during the 2019 Legal Tech Innovation Summit in Hangzhou on 24 November 2019.