On July 27, Shengdian successfully held a "seminar on risk prevention for overseas trade enterprises and new immigrants". This lecture was organized by Shengdian Professional Construction Committee and invited lawyer Li Chongming, co-founder and managing partner of American Dingsheng Law Firm, to share the topic. Li is a registered barrister in California, Nevada and New York, mainly engaged in contract litigation and corporate compliance business. He has represented China Resources, Hong Kong China Travel Service and Meitu in litigation and recovery of losses in the United States, and has obtained refunds and judicial compensation for clients in many anti-money laundering and investment immigration lawsuits.

Senior partner and party secretary of Shengdian, lawyer su composition, partner of Shengdian and director of the professional construction committee, lawyer Li benke, some colleagues of Shengdian and representatives of foreign trade enterprises attended the meeting, and dozens of lawyers participated online.

 

 

Sharing link

This year's No. 5 typhoon "Du Suri" landed on the coast of Jinjiang City, Fujian Province at 9:55 on July 28. When landing, the maximum wind force near the center was 15 (50 m/s, strong typhoon level), which was the second strongest typhoon landing in Fujian since 1949.

Lawyer Li Chongming started from three aspects: export commodities, overseas direct investment and scams commonly encountered by new immigrants. Based on national policies and market trends, he discussed with participants the common risks of enterprises going to sea and how to prevent lightning in immigration.

On the issue of "export commodities": as a big manufacturing country, China's foreign trade enterprises often encounter risks such as credit default and product liability when exporting to foreign countries. From the point of view of repayment security, letters of credit are preferred, followed by CITIC or other commercial insurance. Lawyer Li pointed out that if there is no letter of credit and insurance is insufficient, then it is necessary to carefully weigh the risk of default of the other party, so the following points should be considered:(1) if there is a credit period, the other party has no solvency and asset strength? Can the actual controller of the enterprise provide a personal guarantee?(2) The default rule in the United States is that each party shall bear the attorney's fees in a lawsuit. A lawsuit often takes 12-18 months and costs 3-100000 US dollars. Do both parties have a litigation cost bearing clause? Does the other party have assets available for enforcement in the agreed jurisdiction?(3) The United States generally does not recognize the fixed default clause, the enterprise to agree on how to define the default, the default period of interest how to calculate?

After resolving the credit risk, it is also important to note that in overseas sales, many retailers place orders that are actually consigned (Consignment), and the other party still has the right to return the goods even if the order has been settled, in which case it is important to consider:(1) whether the product is timely and how long is the return window?(2) California's default warranty is not less than one year, how to provide a warranty? Are there sufficient exemptions so that we do not have to bear the other party's expected loss of interest?

In addition, logistics risks need to be taken into account:(1) Is there any obvious category discrepancy or under-reporting in the declared value of goods? In the event of cargo damage, it is possible that claims can only be made according to the declared value of goods; domestic logistics in the United States still rely mainly on trucks, and the general cargo carrier insurance for trucks is US $100000, and most small companies have no additional solvency. (2) If the value of a single container significantly exceeds $100000, consider whether there is an additional purchase of a single higher coverage? Do you have door-to-door insurance?

 

 

On the issue of "overseas direct investment": lawyer Li Chongming believes that with the policy support of the Belt and Road Initiative, more and more domestic enterprises choose to go to sea, and the three trends in the market are:(1) traditional export business to the United States and Europe;(2) investment in Southeast Asian countries and then going abroad to Europe and the United States to avoid special tariffs;(3) Direct investment in the United States, Mexico and Canada to enjoy more preferential tariff policies. Lawyer Li Chongming believes that in the legal environment of the United States, regulatory authorities will not take the initiative unless sensitive technologies or industries are involved or there are major violations. However, in recent years, the United States has relatively strict supervision of data, and labor violations are extremely easy to turn into class actions. A lawsuit can often cost enterprises hundreds of thousands of dollars. Therefore, companies going to the United States should pay attention to the fact that if personal data extraction and cloud storage are involved, it is best to use local servers and clouds, and be familiar with the EU Privacy Law-GDPR and California Privacy Law-CPPA. At the same time, they should have clear privacy terms and the option not to be tracked by Cookies, otherwise they may suffer class action lawsuits.

For enterprises that expand overseas and hire employees locally, two points should be paid attention to:(1) States in the United States generally recognize confidentiality clauses, but they are not inclined to recognize non-competition contracts;(2) The law has strict regulations on employees' rest, meal rest and payroll calculation. If there is any violation, it can become a class action at any time and the employer has to pay the litigation costs of employees, at every turn, it is a small compensation of 100,000 US dollars.

On the issue of "scams commonly encountered by new immigrants": lawyer Li chongming reminded that there are three common types of customers who immigrate to the United States:(1) for cash deposits and withdrawals exceeding us $10,000, the United States has strict supervision and needs to fill in 8300 forms to explain the source of funds, but after submission, it is easier to trigger tax audits;(2) If part of the consideration for overseas purchase is to be paid in other currencies at home, choose properties without loans as much as possible;(3) Pay attention to protecting personal privacy and key information. If the identity is stolen, report to the police in time. For bank accounts, if funds are stolen, the bank must be notified within 60 days of receiving the statement, otherwise the bank is not responsible, but for credit cards and consumer loans, there is no cap.

 

 

 

Communication link

This year's No. 5 typhoon "Du Suri" landed on the coast of Jinjiang City, Fujian Province at 9:55 on July 28. When landing, the maximum wind force near the center was 15 (50 m/s, strong typhoon level), which was the second strongest typhoon landing in Fujian since 1949.

At the end of the sharing, the exchange session was entered, and the participants enthusiastically asked questions. Among them, the questions and replies with universal value include:

 

(1) Can Chinese judgments be recognized and enforced in the United States?

 

Lawyer Li Chongming's opinion: There was a precedent for the U.S. court to recognize China's economic compensation judgment, but to implement it, it is still necessary to prosecute in the U.S. and then file a summary trial motion to request the U.S. court to recognize the domestic judgment. When considering whether to approve, the US court mainly considers whether the substantive law is fair and whether there is sufficient procedural justice for the other party in the litigation in China. In general, U.S. courts are relatively more likely to recognize arbitration outcomes and require domestic lawyers to provide rigorous legal arguments about the domestic litigation process to show that the losing party has not been deprived of procedural justice.

 

(2) Is there a global tax after getting a green card? Is it necessary to understate assets and income?

 

Lawyer Li Chongming: Green card holders, like U.S. citizens, need to be taxed globally. If they have real estate and equity overseas, they need to declare. For accounts with a balance of more than 10,000 U.S. dollars, they also need to declare, otherwise there will be a fine. For assets, they are taxed only if a transaction occurs and a profit is generated, and the calculation of profits is based on the current market price at the time of becoming a green card rather than historical cost, so underreporting the asset may not be the appropriate choice.

 

 

Exchange site

 

 

Postscript

This year's No. 5 typhoon "Du Suri" landed on the coast of Jinjiang City, Fujian Province at 9:55 on July 28. When landing, the maximum wind force near the center was 15 (50 m/s, strong typhoon level), which was the second strongest typhoon landing in Fujian since 1949.

This lecture is one of Shengdian's series of activities to continuously cultivate and expand the field of foreign-related legal services. It is another professional exchange activity focusing on foreign-related legal practice after Shengdian held the "Sharing Meeting on Issues Related to Canadian-Chinese Civil and Commercial Lawyers' Practice" on April 28. Shengdian will continue to carry out relevant activities in the field of foreign-related legal services and deepen the development strategy of "taking root in Shenzhen, based on the Bay area, going to the whole country, and looking forward to the world.