On the afternoon of June 6th, 2018, W&B and LCOUNCIL jointly hosted a workshop entitled “Chinese Enterprises on an Expedition Overseas: Remedial Compliance Measures for the International Trade Export and Reexport Control Crisis” at W&B’s Shanghai head office. W&B specially arranged for its Partners Cathy Wu and Ze Gao to be the guest speakers at the workshop. The speakers, taking the opportunity of the ZTE event, cited some real cases and shared their views on compliance issues that the enterprises may encounter in terms of international trade export control and contract management. The workshop attracted about 25 legal counsels or compliance officers of domestic and foreign enterprises from the industries including electronic products, automobiles and parts, manufacturing, logistics, fast moving consumer goods, chemical and TMT.
In March 2017, ZTE paid a fine in the amount of 1.17 billion USD and signed a settlement agreement, for which the 7-year export injunction was temporarily suspended. In April 2018, US Department of Commerce reactivated the injunction on the ground that ZTE violated the settlement agreement. On May 25th, US Department of Commerce submitted the intended release on the injunction to the US Congress. Till this moment, the injunction is still in the activated state and ZTE will likely be subject to another tremendous fine.
At the workshop, the speakers and the attendees, taking the ZTE event as an example and starting from the US export control rules, had heated discussions over the issues including the countermeasures for export control and the establishment of compliance systems within the enterprises, as well as how the enterprises can perfect their compliance systems for the execution and performance of contracts.
W&B’s Partner Cathy Wu first provided an overview of the process of and the evidence and compliance issues involved in the ZTE event, analyzed the export control countermeasures for the enterprises, and then proposed eight elementary suggestions for the establishment of compliance procedures and systems, which specifically include attention from the management, risk assessment, licensing or authorization for export, internal files archiving and remedial compliance measures, etc. Sharing her thoughts on the ZTE event and citing real cases she once handled, Ms. Wu analyzed the problems confronting the enterprises and proposed her practical suggestions to the compliance officers from the perspectives of both solutions and remedial measures.
W&B’s Partner Ze Gao shared her lecture using the title “Contract and Compliance Risk Control in International Trade”. Ms. Gao started from the causes of ZTE’s skyhigh fine and cited some cases involving the application of law in contracts of international sale of goods, and then provided a summary of export control countermeasures and strategies applicable in different territories and under difference circumstances for the attendee legal counsels and compliance officers. Ms. Gao’s lecture clearly elaborated on the key factors in the export compliance system, and shared recommendations on the remedial measures to be taken in different stages. The lecture was well received among the attendees.
Approaching the end, W&B’s Partner Xiaobo He accurately summarized the entire workshop, and based on the lectures of the two speakers, he shared some practical suggestions accumulated from his over a decade’s experience in the relevant practice areas with the attendees on how to improve the enterprises’ compliance systems.
The workshop jointly hosted by W&B and LCOUNCIL aroused in-depths discussions over how the enterprises can respond to the potential crisis of export and reexport control in international trade and perfect their compliance systems and how to preset remedial compliance measures. The workshop came to an end in the interactions between the speakers and the attendees.
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