Research & Analysis

The 2012 launch of China’s anticorruption campaign has renewed US companies’ attention to anti-bribery, competition, and corruption-related policies and regulations. The challenges of compliance have continued to evolve since the US-China Business Council’s (USCBC) 2013 Compliance Best Practices Report, as China has promulgated new local laws and regulations. As USCBC members work to ensure compliance, however, they continue to cite the same four challenges: tracking multiple Chinese laws; adapting global policy to regional issues; managing stricter expense approvals and gift giving thresholds; and building comprehensive compliance training programs.

In December 2016, the National People’s Congress promulgated China’s first Environmental Protection Tax Law (the EPT Law), replacing the existing Pollutant Discharge Fees (PDF) system in a bid to strengthen the enforcement of environmental regulations. Given the EPT Law’s impact on China’s tax system, enterprises producing contaminants, as well as taxpayers and new market entrants need to understand the new developments in order to better prepare for future compliance requirements.

Chinese entities looking to invest in the United States or acquire US corporations should expect 2017 to be filled with greater energy and uncertainty due to a number of factors. Most notably, the policies and rhetoric of the administration of President Donald Trump, who was elected after a political campaign of “economic nationalism” and protectionist rhetoric.

Early in his presidency, Trump signed a presidential memorandum announcing America’s withdrawal from the Trans Pacific Partnership (TPP). But TPP survived the setback, and people are still referring to it as an embodiment of what is to come in global trade and investment development.

Facing ongoing pollution challenges and a push to diversify energy sources, China’s energy planners kicked off 2017 by announcing an array of 13th Five-Year Plans (13FYPs). Offering quantifiable short-term goals for limiting reliance on coal in favor of oil and gas, these plans collectively focus on emissions cuts, renewable energy development, and improved energy industry efficiency, while encouraging technology solutions such as data centers.