So your company is under internal investigation in China? Join the club. The next steps you take will be crucial in identifying risks and ensuring your legal bases are covered, write Leon Liu and Jared T. Nelson
Almost every business entity in China has been exposed to investigation triggers, whether from a disgruntled employee whistleblower, a government dawn raid, a social media post, an investigative TV report, or even a customer complaint. As a result, one of the most common issues for every company in China, in every industry, is how to conduct an internal investigation.
Finding the right approach requires careful preparation and experience to navigate several important issues that often arise related to core legal factors, business partner relationships, public relations strategies, interactions with the government, and employee terminations. One wrong step in this process could suddenly double your liability by creating new violations when attempting to uncover existing issues. This risk is highest when attempting a “DIY” strategy inside the company, or hiring outside consultants or firms that lack adequate legal training or basic understandings of key legal issues that typically arise during an investigation.
Leon Liu is a partner and Jared T. Nelson is a foreign counsel at MWE China Law Offices, a Shanghai-based law firm with an exclusive alliance with global law firm McDermott Will & Emery.
Liu leads a multidisciplinary team of compliance lawyers focusing on crisis management and investigations, while Nelson leads the MWE China Data Centre, which focuses on digital evidence analysis, data privacy and data security.