Recent changes to Chinese tax law has dramatic tax implications for foreign investors in the People's Republic of China. Despite the changing tax landscape, there are still opportunities to take advantage of current tax law.
Continue Reading...Should there be legal protection for virtual property in China? This is a heavily debated topic in China with avid supporters on both sides.
Continue Reading...In February of 2005, Zhang Bin (“Zhang”) offered for sale one user account for the online game Paradise. On the sales ad, Zhang claimed his account has a high player level and excellent equipment. In March of 2005, Mr. Shen purchased Zhang’s Paradise account and password for 4800 RMB. Soon after Mr. Shen’s purchase, he noticed that his Paradise account had been stolen. After investigation, local police arrested Zhang on March 28, 2005 for theft. The case “Zhang’s Alleged Theft of Account” was heard by the Ningbo Haishu District Court. The court found that virtual property could be the subject of theft because virtual property is controllable and transferable without losing value. The court found that Zhang’s actions amounted to the crime of theft. Zhang was sentenced to one year imprisonment with two year suspension of sentence and a fine of 5,000 RMB.
Continue Reading...On October 23, 2008, China and Singapore signed the China-Singapore Free Trade Agreement (CSFTA), which is the first comprehensive bilateral Free Trade Agreement between China and an Asian country. The Agreement will come into effect on January 1, 2009, once both sides have completed the necessary legislative processes. It is believed that the CSFTA, concluded after two years of negotiations, will enhance China-Singapore bilateral economic relations by further decreasing or removing barriers to trade.
Continue Reading...The State Administration of Taxation recently announced the levy of individual income tax on income obtained through network virtual currency transactions. The announcement is as follows:
Continue Reading...Today, virtual currency trading is widely accepted in China. Billions of RMB in virtual currency is being traded online, and this amount increases by 20% every year. There are two major types of virtual currency. The first type of virtual currency is offered by instant messaging and portal-based issuers. Examples of such currency include Q Coins from Tencent, U Coins from Sina, POPO Gold Coins from NetEase, and Baidu Coins from Baidu. Q Coins is the most popular virtual currency in China because Tencent’s instant messaging software QQ dominates 90% of the market in China and has four times the users of MSN. Starting in May 2002, users can purchase Q Coins with RMB at the exchange rate of 1:1. Tencent has always prohibited users from selling back or exchange Q Coins for real money. Tencent’s original intention was for users to spend Q Coins on Tencent operated websites. However, the popularity of Q Coins has projected Q Coins beyond Tencent’s control and Q Coins are now being trade for real money and used as an online payment system.
Continue Reading...In August 2008, in order to attract the private equity ("PE") investment in Shanghai, four governmental divisions of the Shanghai Municipality jointly issued the Notice on Business Registration and Other Issues of Equity Investment Enterprises ("Notice"), which regulates the categories, investors, forms, capital, and taxation of equity investment enterprises.
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