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Regulation of technology import: China

13 November 2019

Despite being both lawful and commonplace to choose foreign governing law and foreign forum in a technology import contract entered into between a foreign transferor and a Chinese transferee, it is impracticable for the foreign party to the contract to avoid the Chinese court when it seeks to enforce against the Chinese counterparty. As the Chinese court is virtually inevitable where enforcement is sought against the Chinese transferee, so is the application of mandatory Chinese law.

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This note produced with Practical Law provides an overview of Chinese laws and regulations concerning the import of technology into China. It focuses on the details that one should be familiar with to competently draft a technology import contract for the Chinese market. The note also discusses the 2019 revocation of some of the more offensive provisions of the Technology Import and Export Regulations 2001 (TIER) and discusses the lingering effects of the revoked provisions.

The note provides practical and up-to-date advice to foreign companies seeking to import technology into China. Accordingly, the note expresses views and provides suggestions almost exclusively from the perspective of the foreign technology transferor. The same views and suggestions may prove unhelpful, or even counterproductive, while preparing a draft contract for the Chinese importer in a technology import transaction.

Reproduced from Practical Law China with the permission of the publishers.

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