Corporate tax in the UAE
In January 2022, the Ministry of Finance (Ministry) of the United Arab Emirates (UAE) announced its intention to…
News added 30.01.2020
Leaders of US and China have signed a first phase of the fair trade agreement thus deescalating mutual trade war.
Prior to signing the agreement, the Trump administration removed China from the its black list of foreign currency manipulators – one of the issues that led to the trade war. Instead, China was moved into the monitoring list together with nine other countries including Germany, Italy, Japan, Korea, and Switzerland.
The agreement contains important provisions which give American companies special status and substantial protection in their activities in China. Particularly, American organizations will be authorized to manage investment funds, provide insurance services and clearing payments in China.
In the field of intellectual property protection, a provision has been introduced on shifting burden of proof onto the defendant upon introduction of initial evidence of violation (including circumstantial evidence), as well as other measures regarding temporary injunctions, facilitating presentation of evidence from abroad and eliminating the requirement of significant damage to the IP owner as a precondition for certain actions against the violator.
In the regulatory sphere, a ban has been established for the Chinese authorities to require the provision of information in excess of what is necessary as part of licensing or conducting investigations, as well as involving potentially biased external experts in such activities.
It was also established that if the term for approval of a patent application exceeds 4 years, the validity of the patent is extended accordingly. Additional obligations are established in order to combat the unfair registration of trademarks (for example, to block a competitor or force a buyout of a trademark at an inflated price).
The most important provisions are those that prohibit setting conditions for granting of permission to operate on the Chinese market to American organizations, upon transfer of their technology to local organizations, or incorporation of local technology into their products. All technology transfer mechanisms can only be on voluntary base and at the market terms. The ban applies to direct and indirect requirements, as well as informal restrictions.
The American organizations has been also granted right to be represented by lawyers and the right of access to evidence against them, in all administrative proceedings. In addition, American organizations got the right to receive information about the nature of the proceedings, the procedure and evidence applicable to the process, which is not usually applicable during the proceedings in China.
In the field of agriculture and the food industry, it has been determined that for some types of products it is sufficient to comply with American standards and certification for marketing in the Chinese market.
To this should be added detailed mutual complaints mechanism, with a number of decision-making levels and precise deadlines for responding.
In return, as part of the first phase of the agreement, the United States agreed to lower recently imposed tariffs for Chinese goods and suspend levying of new tariffs. In exchange, Beijing pledged to purchase USA goods, including agricultural products, refrain from competitive devalvation and introduce transparency and accountability in the yuan rate, said US Treasury Secretary Steve Mnuchin.
The relief will only apply to some of the Chinese goods subject to US restrictions.
For example, the 15 percent tariff introduced by the US government last September for Chinese goods worth $ 120 billion, will be reduced to 7.5%, while the 25 percent tariff for Chinese goods worth $ 250 billion will remain unchanged. The US President said that the recently imposed American tariffs on Chinese goods will be completely cancelled after both countries approve the 2nd phase of the trade agreement.