Our areas of focus include market-entry services, establishment of tax efficient corporate structures, sports & entertainment law, intellectual property theft protection and litigation, international trade & agri-food and country specific (China, Hong Kong, Japan, Southeast Asia and Canada) practice groups.
Market-Entry: Our market-entry practice area was designed to provide a unique service for small to mid-sized international business that expand into and operate in China by offering combined legal, accounting, tax, human resources and business consulting services from one firm as an alternative to hiring multiple service providers during the market-entry expansion phases of business. Clients who utilize our market-entry services often establish an operational entity in China underneath another corporate entity in a tax efficient jurisdiction such as Hong Kong. After experiencing success in China, many clients move on to invest into Japan and Southeast Asia.
Sector Specific (International Trade, Agri-food, Sports and Entertainment): China has the largest manufacturing output in the world and has also shifted to a consumption economy due to the increase of disposable income levels, as a result, a large number of our clients are involved in international trade. The majority of our clients operate in sectors that focus on bringing technologies or high-quality products or services to China’s rapidly expanding consumer market. In recent years, we have provided services for various clean-tech, foods and beverages and sports and entertainment companies that have entered the Chinese market to respond to the needs of China’s consumers.
Intellectual Property: We specialize in assisting our clients with identifying their intellectual property rights and help adopt and activate strategies to prevent intellectual property theft. We also specialize in providing IP litigation services and have successfully defended numerous clients in lawsuits against Chinese companies who have registered the intellectual property of our international clients in China, have cancelled numerous IP registrations made in bad faith and received court orders to destroy counterfeit products and provide compensation for illegal gain.
Country Specific: We specialize in providing a full range of combined legal, accounting, tax and business services to small and mid-sized companies in China, Hong Kong, Japan and Southeast Asia. Additionally, our China-based Canadian lawyers and our professionals throughout Canada’s major cities focus on providing a full range of legal and business services for our clients in China including, business law, real estate transactions, international trade, family law and estate planning.
Market-Entry Services for Midsized Businesses in China, Hong Kong, Japan and Asia
There are a variety of ways in which a company can enter Asian business markets but a well-constructed approach to market-entry is crucial. No single market-entry strategy works for all international markets and this is especially true for businesses that are established in Asia. Direct exporting may be the most appropriate strategy in one market while in another market licensed manufacturing may be the best choice and in another market setting up a joint venture is the only or most effective solution. There will be a number of factors to consider when entering the Asian markets; such as, marketing and transportation costs, registered capital requirements upon the establishment of a business, administrative burdens of complying with local tax and other laws, political stability, risk of intellectual property theft, corporate income tax and duty rates, foreign exchange controls and withholding taxes when profits are remitted to overseas corporate headquarters.
When initially conceptualizing market-entry strategies into Asia, we take into account the above-mentioned considerations, and can help our clients choose the appropriate location for their operations and a tax-optimal business structure, assist with the preparation of business plans, assess market potential, growth and competition, carry out cost–benefit and risk analysis and conduct other market research activities.
The list of factors to consider upon market-entry is extensive and rather than applying a one size fits all approach, we sit down with our clients and spend time to listen to them and evaluate how we can tailor a service package especially suited to their needs. The localized knowledge of our professionals, along with the advice provided by our law, finance and business professionals allows us to assist our clients with a broad-range of market-entry consulting services including but not limited to the services below.
Legal Services: A well-constructed approach to market-entry is crucial and seeking the advice of experienced legal professionals prior to entering into Asian business markets to discuss your business plan while learning about intellectual property protection mechanisms, available corporate structures, licensing requirements, compliance obligations, industry specific laws and the legal and finance systems of a new market is often invaluable.
Whether a start-up project or the acquisition of existing operations, we assist with all areas of law such as: company establishment, trademark and intellectual property registrations, opening subsequent offices, corporate restructuring, due diligence during asset or company acquisitions, background checks on potential customers and business partners, creating shareholders, joint venture and strategic alliance agreements, drafting licensing, financing and franchising contracts, advising on employment and social insurance, agri-food, environmental, sports & entertainment and other industry specific laws and property ownership structures in Asia, completing real estate transactions and assisting with tax structuring, profit repatriation and wealth preservation.
Intellectual Property Protection: Prior to engaging in initial market-entry activities such as attending business conferences or meetings with potential customers or conducting marketing, we highly advise our clients to submit applications to register patents, trademarks and/or copyright, prepare to enter into dual language contracts with potential customers containing strong non-disclosure, non-use, non-solicit and/or non-circumvent clauses and to develop business systems that will help reduce the risk of intellectual property theft.
Corporate Structure and Offshore Services: After meeting with your legal team and creating intellectual property protection mechanisms, we commonly move on to advise our clients on establishing tax-efficient corporate structures. Many mid-sized businesses benefit from incorporating a holding company in Cayman Islands, Hong Kong, Singapore or another tax efficient jurisdiction to control its operational companies in China, Japan and Southeast Asia.
The benefits of setting up a holding/management company in countries such as Hong Kong include taking advantage of clear and stable legal and finance systems, reducing taxes, having an entity which can easily bring in (or remove if necessary) shareholders as investors and business partners. In addition, if a holding company experiences success in one country, such as China, and then moves on to establish multiple operating entities in China and/or in other Asian countries, the holding company often becomes a valuable asset which may attract new investors and/or potentially be sold or listed on a stock market.
Hong Kong: For clients who are investing into China, many establish holding companies in Hong Kong. We offer a full range of legal, accounting and business services and are also licensed to incorporate companies, provide corporate secretary services and register trademarks in Hong Kong. Providing a full range of services in both Hong Kong and China is often much more efficient for our clients who would otherwise hire multiple firms in both countries. Many of our clients also not only utilize their Hong Kong business entities as holding companies but also conduct business inside of Hong Kong, and our lawyers, accountants and consultants are readily available to assist in Hong Kong.
Establishment of Operating Companies: Establishing an entity in China, Japan or Southeast Asia involves multiple procedures and the physical filing of notarized and executed local language documents with various government departments and such procedures can become complex and time-consuming. We specialize in establishing foreign invested entities such as wholly foreign owned enterprises (WFOE), joint ventures, general and limited partnerships and limited liability companies in China, Japan and Southeast Asia and also assist with applications for particular licenses when required. In addition, we also provide physical or virtual addresses that are required during company establishment upon the request of our clients. Having one firm assist with establishing holding companies in tax efficient jurisdictions and operational subsidiaries in Asian’s major markets streamlines the process enabling us to provide fast turn-around times for the establishment of corporate entities for our clients so they can begin to focus on securing business deals as soon as they enter the market.
Corporate Compliance: Foreign-owned companies in Asia are obligated to comply with complex corporate, securities, tax, anti-corruption, anti-bribery and other laws and regulations that international business owners are often unfamiliar with. In addition, personal liability for actions taken by a company in Asia may be regarded differently than in other Western countries, which also makes corporate compliance a particularly important consideration for our clients. We offer a comprehensive range of services to help our clients develop appropriate compliance policies and systems to ensure they are in good regulatory standing both at home and abroad.
Hong Kong Company Secretary Services: Moxiu is a registered Trust Company Service (TSCP) Provider holding a TSCP license and is often in engaged as the Company Secretary of our client’s business in Hong Kong to act as Company Secretary (as defined in the Companies Ordinance), provide a registered business address, prepare documentation for and file the Company’s annual return, organize and maintain the statutory documents of the Company, allot shares, appoint and/or remove directors and shareholders, and take measures to ensure the Company is in compliance with government regulations.
Accounting & Tax: Due to unique and mandatory tax-filing and other regulatory compliance laws in Asia, the small and medium-sized enterprises (SMEs) we assist often require outsourced support with back-office administration and accounting.
Since the majority of our clients are SMEs that require both legal and accounting services; to respond to their needs, our lawyers work alongside our finance and accounting experts to establish accounting management systems for our clients. Our professionals continue to administer these management systems until our clients are ready to hire internal staff to complete accounting and administrative tasks in-house or we alternatively continue to provide long-term outsourced accounting and/or administrative support.
We also assist by establishing accounting systems to fulfil mandatory monthly, quarterly and yearly accounting, tax and governmental compliance procedures. Our experienced accountants and tax advisors offer hourly consultations on profit repatriation and lowering corporate, VAT and other taxes and these consultation sessions often prove to be invaluable for our clients.
Human Resources: With a corporate structure in place, we assist expatriate executives with applying for foreign work permits and provide assistance with hiring employees such as drafting employment contracts and setting up social insurance accounts and payroll systems.
Our human resources professionals work closely with our labor and employment lawyers and our accounting and tax professionals to provide our clients with a range of services such as: advising on labor and employment law compliance requirements, employee recruitment, labor outsourcing or labor dispatch services, applying for foreign work permits for expatriates, setting up corporate bank accounts and social insurance and individual income tax accounts, fapiao issuance services, payroll solutions (e.g. payment of social insurance, housing fund, individual income tax and employee salary payments), drafting employment contracts, employee handbooks, internal employment and work safety rules, intellectual property protection agreements, termination agreements, shareholders agreement, and stock option and profit-sharing plans. We also provide arbitration, mediation, settlements and dispute resolution services.
Contract Drafting: We specialize in drafting contractual clauses to protect international corporate investment and have years of experience with drafting commercial contracts of various kinds with non-standard clauses that must be developed to suit our client’s particular needs in each case. At the outset of drafting major international commercial contracts, we help our clients gain an understanding of the legal systems, business practices and cultures of the counterparty’s country and local district. Without guidance from local counsel, a foreign company may rely on contractual provisions that are overridden by provisions of local law or the foreign company may be unaware of important statutory rules that can have a significant impact on their rights under the agreement
During the process of drafting contracts, we have advised clients in every sector of the economy on a wide spectrum of corporate and commercial matters. For example, we have experience with handling commercial contracts for services, licensing, development, distribution, marketing, manufacturing, outsourcing, support and maintenance companies. We draft contracts for construction, sports and entertainment and agriculture companies, businesses with environmental and innovative technologies and draft contracts for small and medium-sized enterprises that are developing new businesses or expanding operations throughout Asia.
We regularly draft international trade contracts and advise on laws that are unique to particular countries and districts, such as the validity of restrictive covenants, licensing and labelling requirements, environment and tax regulations, choice of applicable law and forum and mechanisms for dispute resolution. We also specialize in creating shareholders, joint venture and strategic alliance agreements and drafting licensing, financing and franchising contracts and real estate related agreements such as commercial leases, agreements for the purchase and sale of real property and residential tenancy agreements. Our contracts can be drafted in English, French, Chinese, Japanese and Thai languages.
When initially conceptualizing market-entry strategies we offer our clients assistance with choosing the appropriate location for their operations and a tax-optimal business structure and can also assist with the preparation of business plans, assess market potential, growth and competition, carry out cost–benefit and risk analysis and conduct other market research activities. We can also assist with conducting industry specific research in areas that we specialize in such as international trade, food & beverages and products sales, franchising, sports and entertainment, agri-food and environmental and other technologies.
Developing Sales Platforms: China’s appetite for foreign brands, healthy food and other products that will increase living standards combined with the spending power of Chinese consumers offers an attractive market for foreign businesses. For example, “Singles Day” has become the largest physical retail and online shopping day in the world. Creating the right online and offline sales platforms when selling products in China is essential to success.
When selling directly to distributors and other buyers in China it is important to enter into contracts with strong intellectual property protection clauses and clear mechanisms to recover if a deal does not work out as planned. Due to differences in cultures, time zones, business practices and a variety of other factors, closing a deal with a Chinese buyer can present obstacle which our lawyers are readily available to help market-entrants overcome. We often assist with contract negotiations and contract translations using both English and Chinese languages.
To provide an overview of the leading online sales platforms, JD.com is China’s leading one-stop e-commerce platform which focuses on sourcing products directly from brands and suppliers and selling them directly to customers in China. Taobao is one of the largest online marketplaces in China and the merchants on Taobao are primarily individuals and small businesses. Tmall is China’s largest B2C e-commerce platform and this is often where international brands start selling in China. WeChat users can turn their individual accounts into platforms for e-commerce by using “Mini-Programs”. In addition, though most consumers do not buy directly from a retailer’s website, well designed websites are also important.
Cash and credit card use is rare in China since most consumers use digital payment systems such as Alibaba’s Alipay and Tencent’s WeChat Pay, enabling consumers to use mobile phones to make purchases online or nearly anywhere in China without having to own a wallet.
With many forever changing options available, market-entrants often hire local services providers to help narrow down which platforms are best for their businesses and to help create their marketing, social media and digital payment platforms. As such, we have established partnerships with information technology professionals so that we are able to provide a full range of services to market-entrants.
Our business development team ranges from former government officials to experts in particular fields such as sports and entertainment, agri-food and international trade to business owners who have gone through the many steps to successfully establish and operate a business in China, Japan and/or Southeast Asia and now offer consulting services to market-entrants who on a mission to do the same. The range of services our business development teams offer includes:
- Assisting clients on locating and making arrangements to attend relevant trade fairs
- Advice regarding online marketing in Asia
- Assisting clients with publishing online advertisements on Asian marketing platforms
- Translation of business presentation documents in multiple languages
- Assistance with negotiations and contract translations in Japanese, Chinese, Thai, English
- Brand consultation and advice on patent, copyright and trademark registration
- Identifying, screening and arranging meetings with potential business partners and customers for our clients when they are unable to visit China, Japan or Southeast Asia
- Provision of local resident directors and other board members
- Matching international business owners with private or state-owned businesses in Asia that are seeking foreign technologies
- Introducing private equity, other investment funds and high net-worth individuals to businesses that require investment
Product Market-Testing: Unlike many other legal or accounting firms, after we have completed initial market-entry services for our clients, we offer further assistance by providing a range of business services. For example, some market-entrants prefer to secure business opportunities prior to fully taking on the risks of entering into the Asian business markets. To respond to the demand for an interim solution, Moxiu provides a “market-test” solution to help our clients secure sales contracts prior to establishing their own business entities in China and Asia.
We provide solutions such as acting as a liaison office on-the-ground in China, Japan and Southeast Asia that can assist by locating and introducing potential distributors or business partners, conducting in-person negotiations on behalf of our overseas clients and by providing the use of the business licenses of our affiliated trading company (https://moxiucompany.com/) to help our clients determine if there is a demand for their products in China and other Asian business markets. Clients operating in industries where it is beneficial to establish multiple local sales channels instead of selling to a large distributor, such as food and beverages companies, have utilized our licenses to run test sales programs in China prior to establishing their own entity to import and sell their product to Chinese consumers. Moxiu acts as liaison sales office during this initial product market-test.
We also provide employment outsourcing services enabling our clients to employ staff, typically business development or sales staff, prior to establishing a legal entity in Asia. In addition, when overseas clients are directly exporting to China without having a local entity, after sales services are required, and our trading company is able to act a services liaison in this circumstance.
Our “market-test” services allow our clients to gain a clear understanding of the advantages of incorporating in Hong Kong, China, Japan or Southeast Asia without taking the upfront risk of establishing entities that may later need to be deregistered.
Establishment of Tax Efficient Corporate Structures
Cayman Islands and Guernsey
Our partners specialize in providing company formation and management services to Chinese private equity and venture capital funds in Cayman Islands and Guernsey. We also assist private clients with wealth management, succession planning and establishing family trusts. Since many of our private clients have assets, family members and beneficiaries spread across different countries, our partners have developed an expertise in the legal, tax and compliance issues that arise when the laws of several jurisdictions apply. We also assist with applications to open bank accounts by making introductions to banks and providing associated notarization and translation services when required.
Hong Kong and Singapore
We focus on establishing legal structures for our international clients in China through holding companies in Hong Kong or Singapore since this is a tax efficient corporate structure that allows our clients to create a corporate headquarters in Asia that manages and operates operational businesses first in China and then in other countries such as Japan, Southeast Asia and also in Hong Kong and Singapore. With regards to operating a business in Asia, the legal and banking systems in Hong Kong and Singapore are often ranked as top countries to do business in world-wide. Hong Kong or Singapore entities have proven to be valuable assets for many of our clients.
Great efforts have been taken to curb intellectual property theft in Asia but problematic issues remain. As such, the issue of protecting intellectual property rights is commonly the biggest hurdle for most business owners to overcome when they are considering business opportunities in Asia. Since joining the World Trade Organization, China has strengthened its legal framework and amended its intellectual property laws and regulations but the piracy rate in China remains as one of the highest in the world. Piracy in Thailand, Indonesia and other countries in Southeast Asia is also prevalent despite efforts taken by the governments of these countries to reduce intellectual property theft. Some investors assume there is no use in attempting to take preventive measures to protect their intellectual property in Asia; however, this assumption has caused a number of companies to lose valuable intellectual assets that could have been otherwise saved if preventative measured had been taken. Although there is no fool-proof way to preserve intellectual property rights in Asia, there are a variety of ways to protect technology, brands and other intangible assets that can substantially lessen the risk of intellectual property theft.
Despite negative media with regards to the enforcement of China’s intellectually property laws, we have successfully defended numerous clients in lawsuits against Chinese companies who have registered the intellectual property of our international clients in China. We have also cancelled numerous intellectual property registrations made in bad faith and received court orders to destroy counterfeit products and provide compensation for illegal gain.
Our intellectual property experts assist our clients with identifying their intellectual property rights and help adopt and activate strategies to prevent intellectual property theft.
Our patent and trademark lawyers specialize in registering franchising and intellectual property licensing agreements, copyrights, trademarks and patents and provide expert opinions at the outset and during the registration process.
Since intellectual property theft is common in China, we advise our clients to enter into clearly written English and Chinese contracts with business partners, customers, suppliers, manufacturers and distributors in China. We commonly recommend our clients to enter into non-disclosure or memorandum of understanding agreements containing non-use, non-compete, non-solicit and non-circumvent clauses during the beginning stages of developing business relationships in China and to enter into more detailed contracts prior to moving forward with conducting business containing similar clauses as well as specific and detailed punishments for breaching such provisions.
Sports & Entertainment Law
Prior to COVID-19, our sports and entertainment lawyers in China noticed a significant increase in demand for our services.
Sports: In October 2014, the Chinese government released a policy document that outlined China’s plan to create the biggest sports industry in the world, with the target of five trillion RMB in annual revenue by 2025. Seeing an opportunity to engage and ultimately monetize on an enormous new consumer base, North American and European sports leagues and businesses, large and small, are investing into China. These are wide-ranging strategies covering sponsorships, staging events and selling merchandise, developing fitness apps and products, creating and operating youth sports leagues, selling products and services required for major sporting events, recruiting Chinese athletes for overseas sports and education camps and entering into strategic partnerships designed to develop sports from the bottom up.
Entertainment: At the same time, China is becoming the largest movie market in the world with theatre chains in China building as many as 25 movie screens a day. Online entertainment, such as esports which is now recognized as a professional job title in China, is also growing at an unprecedented pace, with Chinese consumers spending more than 4.7 hours per day on entertainment apps. Many international film producers and live entertainment companies have concluded that the time is right to enter into Chinese business markets as well; for example, Cirque du Soleil opened its first permanent show in a state-of-the art theatre in Hangzhou, China in 2018.
We have assisted both domestic and international clients in recent years with with their business expansion plans in China. Maybe of these clients have expanded their businesses elsewhere in Asia as well after experiencing success in China.
Our partners are well versed with providing intellectual property, corporate/commercial, corporate finance and dispute resolution related services for clients operating in sports, media and entertainment sectors. We commonly represent film, record label and audio-visual production businesses, live entertainment companies, gaming and information technology corporations, fitness, well-being and entertainment app developers, consulting, stage design, ticketing, sponsorship and merchandising companies that are providing services to sports and entertainment companies, youth and professional sports leagues, clubs, teams, organizations and high-profile individuals throughout Hong Kong, China, Japan and Singapore. Laws and regulations in these countries are constantly changing and having experience in and a specific focus on this business sector allows our partners to provide the timely and professional advice our clients require. Some of our partners are former athletes and others have been directly involved with developing entertainment companies, so we are passionate about these industries and strive to ensure that we provide the highest level of services for our clients.
Manufacturing for Export
Manufacturing for export has fueled China’s growth, and due to higher disposable income levels in China, the country is expected to become the world’s largest importer in upcoming years and in the future. Through imports, China can effectively adjust its economic structure from one oriented primarily towards export to one driven by domestic consumption. Our legal experts assist Canadian companies with exporting products that are in high demand by China’s ever rapidly expanding consumer market, such as food and agriculture products, products and services that improve the environment and technologies that contributing to China’s rapid internationalization. This often involves legal research regarding licensing and labelling requirements, applications for licenses and permits, implementing intellectual property protection mechanisms such as trademark and patent registrations and drafting dual language purchase and sale agreements. In addition, we offer a full range of litigation and dispute resolution services for Canadian clients who have faced difficulties with business partners, distributors and buyers in China.
China is an important jurisdiction for many businesses engaging in international trade. Manufacturing exports have played a large role in helping China emerge as the second largest world economy. Our lawyers assist clients with negotiating and entering into commercial contracts (English and Chinese) with manufacturers and suppliers. We also assist our clients with incorporating entities in Hong Kong and China, applications for permits and licenses, applications for export and other tax rebates and incentives. Our legal team also assists with litigation and dispute resolution with manufacturers and suppliers. If our clients require assistance with locating manufacturers or suppliers, we have relationships with factories, trading companies and and quality control inspectors who we can introduce to our clients. In addition, our affiliated trading company can manufacture custom-made products in China for export or assist with sourcing products from China to overseas.
Agri-Food refers to the commercial production of food by farming and Canada’s agri-food sector often contributes more than $100 billion of Canada’s GDP. Since China is Canada’s second largest export market for agri-foods, we are often approached by clients in China and Canada for our assistance with providing legal and business development services since this sector involves the understanding of and working with technical legal regulations and complex international business relationships. Our lawyers and business consultants, some of which are former Canadian government officials, have been assisting clients in this sector for 15 or more years and we have the in-depth knowledge and networks to provide value added services to Canadian and Chinese businesses operating in this sector.
Country Specific Services in Canada, China, Hong Kong, Japan, Thailand and Southeast Asia
We specialize in providing a full range of combined legal, accounting, tax and business services to small and mid-sized companies in China, Hong Kong, Japan, Thailand and Southeast Asia. Additionally, our China-based Canadian lawyers and our professionals throughout Canada’s major cities focus on providing a full range of legal and business services for our clients in China including, business law, real estate transactions, international trade, family law and estate planning.