Dentons Lee held a joint seminar on January 31, 2023 with the Korean In-House Counsel Association ("KICA") focused on “Response Strategies of South Korean Companies in Xi Jinping's Third Term: Intensive Risk Analysis on Business Withdrawal in China.”

The seminar presented ways to better identify and respond to risks that companies may encounter in China amidst the changed political and economic landscape caused by Xi Jinping's third term. The seminar concluded with great success, focusing on joint ventures and business exits of companies that have entered the Chinese market, and sharing practical ways to respond to business risks in China.

Ki-Soon Park, an advisor in Dentons Lee’s China Group, stated that “if the confusion caused by China's “living with COVID-19” plan is resolved smoothly within the first quarter, then the 5% growth rate that the Chinese government projects as the bottom line will be achievable. However, China has various instability factors caused by the Chinese government's sudden change in its quarantine policy, the platform industry regulation policies due to its common prosperity plan, the trade war, the high-tech war and subsequent blockade of China due to the conflict between the US and China and supply chain confusion. These factors are raising concerns among companies about their ability to get access to the Chinese market for companies. In addition, the positive side of China's domestic market expansion is tempered by several adverse effects of Chinese companies' technological development and wage hikes. Accordingly, companies are at a point where they must choose a strategy that suits their environment and situation among strategic options such as “China Exit,” “China+1” or “In China for China” when considering entering China or securing market access.”

Dentons Attorney Chang-Rong Xu added that “when conducting a joint venture in China, you need to be alert from the very beginning of negotiations, and must draft, review and negotiate in detail the joint venture agreements and articles of association while deliberately considering an exit strategy in advance, from the beginning of the investment. Therefore, it would be better for you to find a Chinese attorney who is proficient in both languages, if possible, who has a deep understanding of the corporate culture of both countries, and has extensive legal experience in JV dispute resolution in China, and have that attorney prepare and review your JVAs and AOAs for preventing future disputes from occurring. In particular, for a successful withdrawal from the Chinese market, it is more important than anything else to retain a law firm that can provide organic and simultaneous legal services in both Korea and China. Dentons Lee has a unique strength in that sense as it runs an organic collaboration system with China's Dacheng Dentons, having a dedicated team of attorneys who have extensive local experience in M&A, corporate dissolution liquidation and dispute resolution in 48 regional offices across China, as well as attorneys in its Korean law firm who can represent the interests of Korean companies with adequate communication skills. Our China Group serves our clients by rendering tailored legal services.”

In May 2020, Dentons Lee launched its China Group, composed of senior Chinese attorneys and experts who have been active in China, to provide legal services to a variety of companies that are interested in investing and doing business in China.

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