Watch out!: Foreigner on Foreigner Crime on the Rise

Wednesday, March 7, 2007 23:56
Posted in category Uncategorized

Over the last 5 years, to say a lot has changed in China is an understatement. It has transformed. Everyday there is something new, and something in the news.

However, one thing that hasn’t changed is that if you have something of value, you need to be careful. this is as true in China as it is in Indiana.

For many foreigners entering the China market, their senses are often heightened to the fact that someone is out to get them. that a Chinese supplier is trying to steal IP, that a staff member is stealing clients, etc. It is story heard time and time again in Shanghai’s/ Beijing’s local watering holes, and has made for famous book (see Mr. China).

However, with the last 3 years seeing a huge influx of foreign business persons, it is not just the Chinese that foreign business persons need to keep a close eye on.

What is most interesting about this is that in the U.S., corporations go to great lengths to do background checks on employees, make vendors jump through hoops, and have systems in place to reduce any risks. however, if one were to look at the various public incidents of what I call “FOB on FOB crime”, it appears as if those controls are either given a bypass or completely thrown out.

There is a common misconception that information cannot be found here, or that because “we are all in this together”, we can all trust one another.

The fact is though, that the risks here of getting rolled over by “one of your own” is higher here. for one, the environment is very dynamic and many people are here to get their’s, and there are some that have figure out that there are less than moral ways to make a buck here.

This means that it is not just the Chinese looking to steal an idea or sell into your channels

One of the most frequent ways that people get into trouble here is in the bars. One of the best things about being in China has been the fact that you can meet a lot of people, and often it is over a pint. And while I have nothing against enjoying a pint, I cannot remember how many times I have been told things that I should not have been.

Everything from future plans to open/ close shop, key employee information, costing, etc all can enter a conversation.. and every time they do, risk enters.

For those that believe it is not possible to do a background check, there are ways. Firms like Control Risks perform personal investigations, supplier audits, and other risk aversion consulting… but many people fail to remember that a foreigner has a track record at home, and that through SOP you can get that .

Of all else fails, goggle the name of the person or company (I somehow have 5 pages).

Prevention aside, many say that even if you are rolled over, there is little that can be done. Again, that is not true. you can structure deals offshore in territories that both parties have entities (HK, U.S, etc), and there are remedies here locally through the police.

A little bit off our normal track, this is a topic that will become more and more relevant as the number of foreign companies increase. don’t’ believe me. check out this site and tell me if this tour could possibly deliver what it promises.

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2 Responses to “Watch out!: Foreigner on Foreigner Crime on the Rise”

  1. Nike Sues French Firm for IP Violations... in China says:

    July 18th, 2007 at 5:33 am

    […] What is not discussed is the role of foreign companies operating in China, and how often foreigners will ask manufacturers to make products that are “similiar”… i.e. close enough to look or function the same, but not close enough to be considered an IP violation (see Watch out!: Foreigner on Foreigner Crime on the Rise) […]

  2. Nike Sues French Firm for IP Violations… in China | Top China Suppliers says:

    July 21st, 2007 at 4:55 am

    […] What is not discussed is the role of foreign companies operating in China, and how often foreigners will ask manufacturers to make products that are “similiar”… i.e. close enough to look or function the same, but not close enough to be considered an IP violation (see Watch out!: Foreigner on Foreigner Crime on the Rise) […]