PART I Regulations Update

More employment contracts signed thanks to labor laws
BEIJING, Dec. 15 (Xinhua) -- A year after new labor laws took effect, more employers signed employment contracts with their workers while more labor conflicts broke out, said a senior socialist here Monday.

The new laws have effective impacts on China's employment relations, said Chen Guangjin, deputy director of the Institute of Sociology under the Chinese Academy of Social Sciences (CASS), when elaborating a report on China's social changes in 2008.
This year China issued two important labor laws, the labor contract law and one on arbitration of labor conflicts. In addition, there was a regulation on the labor contract law implementation and a rule on paid leave.

A Ministry of Human Resources and Social Security survey showed that 90 to 96 percent of employees signed contracts with their employers after the labor contract law took effect on Jan. 1 this year.
"Our investigation showed the figure might not be that high but we did find a notable increase," Chen said.

Meanwhile, the number of labor cases at the arbitration agencies increased a lot, he said. "The number increased by 30 to 50 percent generally but it doubled and even was three times of before in eastern Jiangsu Province and the Pearl River Delta (China's two manufacturing centers)."
The same tendency was also found among labor cases taken to the court, he added.

In most of these cases, conflicts broke out in private companies over salary, compensation for work-related injury and insurance, he said.
"We found that more and more employees stepped out to argue and protect their own rights. Some arguments are new," he said. But he did not explained what the new arguments were.

(Source: Xinhua)

China drafts first law on social insurance
BEIJING, Dec. 28 (Xinhua) -- China's top legislature made public Sunday a draft law on social insurance, the first of its kind in the country.
It specifies a common right for citizens, urban and rural alike, to pay premiums and enjoy social insurance for medical care, work injuries, unemployment and childbirth.
The draft highlights more efficient fund management. Governments at municipal, provincial and the state-level should encourage and support the public's
participation in supervising insurance funds. Any individual or organization has a right to complain or report illegalities.

The law also allows Chinese citizens to pay pension premiums in one place and draw money in another, if they migrate to other cities or provinces. This stipulation is particularity significant as the country has a much more mobile population than in the past.
The draft also determined that a new rural medical system, in which farmers and governments raise funds together, would be included in the medical insurance plan.

Meanwhile, governments will cover medical insurance expenses for citizens who live on low-income subsidies, have serious disabilities or are older than 60 years, the draft said.
The draft law was discussed on Monday by the Standing Committee of the 11th National People's Congress (NPC), the country's top legislature.
Public opinions will be gathered and submitted to the NPC by Feb. 15, 2009. The draft law will then be reviewed in committee.
(Source: Xinhua)

PART II Forthcoming Legislations

New world for China textile exports as quota systems end
BEIJING, Dec. 31 (Xinhua) -- The sun set Wednesday on a quota and license system that governed China's textile trade for decades.
As the United States-China and European Union-China agreements on textiles and clothing expired with the old year, the Ministry of Commerce terminated supervision over quotas on 21 categories of textile exports to the United States and licenses on eight categories to the European Union.
Textile companies might see Thursday -- the first day of 2009 -- as the beginning of an unfettered era of free trade, but the outlook is clouded by weakening demand and rising protectionism amid the financial crisis.

There are few signs that shipments by the world's largest textile exporter will soar.
"With global demand slumping, the expirations will not bring about a repeat of the sharp increase in textile and clothing imports from China that occurred in early

2005," said Sun Huaibin, spokesman for the China National Textile and Apparel Council.
He said that worries about such an increase and its damage to the U.S. market were "groundless."
He said slackening demand resulted in a persistent low rate of quota usage this year.

Quota prices fell from a peak of nearly 20 U.S. dollars to less than 2 U.S. dollars within a year, said Liu Min, a trader with Shanghai Mai Si Ke Te International Trading Co. Ltd.
 "Our exports declined more than 60 percent compared with last year. I heard many textile companies cut exports to the lowest level in recent years. Some even
failed to use up the quotas acquired before the third quarter," said Chen Shubin, general manager of Foshan Qiaoli Textile Import and Export Co. Ltd. in Guangdong Province.
Analyst said shrinking orders in the fourth quarter and dim prospects for next year would mean a "tight" year for textile makers. Textile companies' top challenges would be to secure their market share and tailor production to the domestic market.
Pessimistic forecasters expect exports to continue slumping in the first quarter of 2009. If demand continues to shrink, small and mid-sized companies would barely survive.

Sun said although the financial crisis had diluted the stimulus from the quota expirations, textile makers should not lose confidence because they could retain global market share with cheap, good-quality products.
In November, China's textile exports dropped 3.8 percent year-on-year to less than 5 billion U.S. dollars. Garment exports rose 6.1 percent to 10.4 billion U.S. dollars.

From January to November, textile exports rose 18.1 percent to 60.4 billion U.S. dollars and garment shipments grew 3.1 percent to 108.7 billion U.S. dollars.
China did not change the export tax rebate rate for textiles and clothing in its latest round of tax rebate adjustment, announced on Tuesday, after it had raised the rate twice to 14 percent.

 "It showed the government wanted companies to cope with the crisis by adjustments such as internal industrial upgrades and product structure alteration," said Zhao Yumin, a researcher with the Commerce Ministry.

She said the recent economic stimulus plans had hardly touched on the textile industry, where profits were being squeezed by several factors: stricter environmental requirements, new labor laws, rising land and power costs and a stronger local currency.
The U.S. textile industry remained unhappy about the expirations and wanted the U.S. government to be prepared to act if there was a surge of imports.
Many domestic companies said they cannot tell what the future holds.

Sun said when the new U.S. president takes office, he might not take action with a view to avoiding trade friction.
However, if the U.S. economy remains weak and protectionism rises, the United
States might use quotas or licenses to curb imports from China.

Zhao said governments must guard against rising protectionism amid a global economic downturn. If the U.S.
government moves to protect its textile industry, which has been largely transferred to other countries, both Chinese exporters and U.S. consumers will pay.
"It is also possible that the United States will use its status as the world's largest textile importer to keep China from getting a big market share and thus support other economies," she said.

In early 2005, a surge in Chinese textile and clothing exports to the United States
coincided with the expiration of an international quota system. The United States responded by imposing emergency "safeguard" curbs.
Later in 2005, Washington and Beijing negotiated a broad pact that re-established 21 quotas covering 34 categories of textiles and clothing through the end of 2008. It was that agreement that ended on Wednesday.
 
(Source: Xinhua News )

China revises patent law to encourage innovation
BEIJING, Dec. 27 (Xinhua) -- China's top legislature on Saturday approved the revision of the
Patent Law to allow inventors to apply for foreign patents before domestic ones for their inventions.
The revised law, which takes effect on Oct. 1, 2009, was adopted with 154 votes and four abstentions at the closing meeting of the sixth session of the 11th National
People's Congress (NPC)

Standing Committee.
The change is aimed at encouraging innovation and improving China's "international competitiveness", Chen
Guangjun, a senior official with the NPC's

Education, Science, Culture and Health Committee, said at a press conference after the legislative session.
Previously, the Patent Law stipulated that people, whose inventions were completed in China, must apply for domestic patents first before applying for a foreign one.

The new amendment also says Chinese inventors must first go through government scrutiny before applying for foreign patents to find out if such innovations should be made national secrets.
Inventions which have not undergone security checks will not begranted Chinese patents, according to the law.
The amendment applies to all inventions completed in China.
The Patent Law, which was enacted 1985, has had two major revisions in the past.

 (Source: Xinhua News )

PART III Economy and Law

New world for China textile exports as quota systems end
BEIJING, Dec. 31 (Xinhua) -- The sun set Wednesday on a quota and license system that governed China's textile trade for decades.
As the United States-China and European Union-China agreements on textiles and clothing expired with the old year, the Ministry of Commerce terminated supervision over quotas on 21 categories of textile exports to the United States and licenses on eight categories to the European Union.
Textile companies might see Thursday -- the first day of 2009 -- as the beginning of an unfettered era of free trade, but the outlook is clouded by weakening demand and rising protectionism amid the financial crisis.

There are few signs that shipments by the world's largest textile exporter will soar.
"With global demand slumping, the expirations will not bring about a repeat of the sharp increase in textile and clothing imports from China that occurred in early 2005," said Sun Huaibin, spokesman for the China National Textile and Apparel Council.
He said that worries about such an increase and its damage to the U.S. market were "groundless."

He said slackening demand resulted in a persistent low rate of quota usage this year.
Quota prices fell from a peak of nearly 20 U.S. dollars to less than 2 U.S. dollars within a year, said Liu Min, a trader with Shanghai Mai Si Ke Te International Trading Co. Ltd.

 "Our exports declined more than 60 percent compared with last year. I heard many textile companies cut exports to the lowest level in recent years. Some even failed to use up the quotas acquired before the third quarter," said Chen Shubin, general manager of Foshan Qiaoli Textile Import and Export Co. Ltd. in Guangdong Province.

Analyst said shrinking orders in the fourth quarter and dim prospects for next year would mean a "tight" year for textile makers. Textile companies' top challenges would be to secure their market share and tailor production to the domestic market.
Pessimistic forecasters expect exports to continue slumping in the first quarter of 2009. If demand continues to shrink, small and mid-sized companies would barely survive.

Sun said although the financial crisis had diluted the stimulus from the quota expirations, textile makers should not lose confidence because they could retain global market share with cheap, good-quality products.

In November, China's textile exports dropped 3.8 percent year-on-year to less than 5 billion U.S. dollars. Garment exports rose 6.1 percent to 10.4 billion U.S. dollars.

From January to November, textile exports rose 18.1 percent to 60.4 billion U.S. dollars and garment shipments grew 3.1 percent to 108.7 billion U.S. dollars.
China did not change the export tax rebate rate for textiles and clothing in its latest round of tax rebate adjustment, announced on Tuesday, after it had raised the rate twice to 14 percent.

"It showed the government wanted companies to cope with the crisis by adjustments such as internal industrial upgrades and product structure alteration," said Zhao Yumin, a researcher with the Commerce Ministry.
She said the recent economic stimulus plans had hardly touched on the textile industry, where profits were being squeezed by several factors: stricter environmental requirements, new labor laws, rising land and power costs and a stronger local currency.
The U.S. textile industry remained unhappy about the expirations and wanted the U.S. government to be prepared to act if there was a surge of imports.
Many domestic companies said they cannot tell what the future holds.

Sun said when the new U.S. president takes office, he might not take action with a view to avoiding trade friction.
However, if the U.S. economy remains weak and protectionism rises, the United States might use quotas or licenses to curb imports from China.
Zhao said governments must guard against rising protectionism amid a global economic downturn. If the U.S. government moves to protect its textile industry, which has been largely transferred to other countries, both Chinese exporters and U.S. consumers will pay.
"It is also possible that the United States will use its status as the world's largest textile importer to keep China from getting a big market share and thus support other economies," she said.

In early 2005, a surge in Chinese textile and clothing exports to the United States coincided with the expiration of an international quota system. The United States responded by imposing emergency "safeguard" curbs.
Later in 2005, Washington and Beijing negotiated a broad pact that re-established 21 quotas covering 34 categories of textiles and clothing through the end of 2008. It was that agreement that ended on Wednesday.
(Source: Xinhua News )

Chinese shares conclude worst annual performance, down 0.66%
BEIJING, Dec. 31 (Xinhua) -- Chinese shares edged down 0.66 percent on the last day ahead of the New Year holiday with thin trade volume, as investors confidence remained low, said market dealers.
The benchmark Shanghai Composite Index shed 0.66 percent or 12.10 points to 1,820.81. The Shenzhen Component Index fell 1.11 percent or 72.65 points to 6,485.51.

Combined turnover was 55 billion yuan (8 billion U.S dollars). It declined from 60 billion yuan in previous trading day. Losses outnumbered gains by 638 to 159 in Shanghai and by 476 to 205 in Shenzhen.

An overnight rally in U.S. and European markets gave local bourses a mild boost. The index opened 2 points higher than the previous day, but worries over weakening corporate profits still weighed on the sentiment.
In the afternoon session, the index was dragged down by weak oil and chemical shares. Sinopec, the country's leading oil refiner saw its shares decline 0.71 percent to close at 7.02 yuan.
Iron and steel shares failed to reverse the declining trend in the previous days and continued to fall, as some companies expected poor business earnings in the fourth quarter.

Tangshan Steel fell by a daily limit of 10 percent to close at 3.69 yuan. Handan Steel ended at 3.25 yuan, down 5.25 percent.
Weak demand for energy, such as coal, electricity and gas also pulled down relevant stock prices. Jinniu Energy Resources shed 6.04 percent to 14 yuan, while Hengyuan Coal and Electricity dropped 5.13 percent to close at 11.09 yuan.

The market reflected investors cautious outlook on the economy, said Lin Songli, analyst of Guosen Securities. "A wait and see attitude is lingering around the market."

China's equity market experienced a painful year in 2008, as weak sentiments loomed and drove equity prices lower amid the complex domestic and world economic situation.
The Shanghai index pared more than 65 percent this year from last year's 5,261.56 points, while the smaller Shenzhen market earmarked losses of 62.95 percent during the same period. The performance of the country's stock market was said to be one of the worst worldwide.
Compared with domestic indices, world major indices also posted dramatic losses, largely due to the wide spread financial crunch that first came out of the U.S. sub-prime mortgage crisis.

The major Wall Street index, Dow Jones, plunged about 36 percent in 2008. The Standard & Poor's 500 index slid 41.2 percent and the Nasdaq lost more than 43 percent during the same period.
"Performance of the stock market can directly reflect one country's economic situation. People found it hard to make money from the market this year," said Wu Xiaoqiu, Renmin University of China professor.

"However, things always change. The government has issued a series of policies and measures to boost the economy, and these measures are expected to take effect gradually," Wu added.
Last month, the Chinese government unveiled a 4 trillion yuan economic stimulus package to boost economic growth and domestic demand.
(Source: Xinhua News )

PART IV Introduction to the Firm

Guangdong United Intellectus Law Firm is a full-service law firm with over 20 Chinese and international lawyers of whom some have practiced law in the United States, China and Hong Kong.

In cooperation with law firms around the world, especially with Tsoi & Associates in Los Angeles, California, and Sinkler & Boyd in Columbia, South Carolina, we are able to serve our clients around the clock, as well as working in all kinds of litigation and non-litigation commercial and IPR matters. The allocation of work in the association is based on expertise of the working staff rather than who they work for.

Through this close cooperation, we are able to provide clients with quality legal services that match international practice standards and meet their sensitive needs in the unique Chinese legal environment. We have advised foreign invested enterprises in all industries and assisted many in acquisition and shareholding interests transfer transactions.

The Chinese and foreign lawyers in the association are experienced in domestic and foreign related dispute resolution process, including mediation, arbitration and litigation.

LEGAL SERVICES

Chinese and foreign attorneys of the association have profound practical experience in domestic business litigation, mediation, arbitration and litigation on disputes in foreign economics. These attorneys have represented international clients such as Kodak, Cartier, Montblonc, Piaget, Nissan, Wrigley and Microsoft in
protection of their legal rights.

The main legal services of the association cover but not limited to the following areas:

Annual retainer services, including providing general commercial counseling and contract review requiring no substantial research work, one hour of corporate internal legal training each month, and China Law Update, a quarterly publication of the association;

Commercial transactions, trade, manufacturing, corporate, merger and acquisition, liquidation and bankruptcy, customs and tax planning, labor practices, registration and enforcement of intellectual property rights, real estate development and property management, contract drafting and revision, government approval and public relations, advertisement and unfair competition claims, due diligence and legal opinion to be issued by qualified Chinese lawyers;

Overseas investment and listing, establishing foreign branches for domestic companies, overseas applications and enforcement of intellectual property rights, overseas merger and acquisition; and

Domestic and international dispute resolution through mediation, arbitration and cross-border civil litigation.

MEMBERS OF THE FIRM

Rose Baochun Zeng, B.A., LL.M and J.D., admitted to practice law in China and California, U.S.A. With over thirteen (13) years of practice experience, Ms. Zeng’s major practice areas include corporate and commercial matters, IPR enforcement, dispute resolution and litigation. She is a director of Guangdong Society of Intellectual Property Rights and a panel arbitrator of Guangzhou Arbitration Commission;

William C. Ren, B.A. and J.D., admitted to practice law in China and California, U.S.A. With over six (6) years of practice experience, Mr. Ren’s major practice areas include foreign investment project setup, corporate and commercial matters, IPR protection and labor law;

Michael Y. Qin, B.A. and LL.M, admitted to practice law in China. With over thirteen (13) years of practice experience, Mr. Qin’s major practice areas include foreign investment project setup, commercial matters, civil and criminal litigation;

George L. Sun, LL.B, admitted to practice law in China. With over five (5) years experience as a judge in a district court in Guangzhou and six (6) years of practice experience as a lawyer, Mr. Sun’s major practice areas include commercial and civil litigation;

Ke Y. Chen, LL.B, admitted to practice law in China. With over five (5) years of practice experience, Mr. Chen’s major practice areas include commercial, real estate, and civil litigation; and

Fei Huang, LL.B, admitted to practice law in China. With over five (5) years of working experience with the Legislation Committee of the Guangdong People’s Congress and two (2) years of practice experience as a lawyer, Mr. Huang’s major practice areas include commercial matters, civil litigation, and administrative proceedings.

MAJOR CLIENT LIST

A major U.S. headquartered multinational software company in IPR protection matters, including administrative enforcement, civil litigation and criminal litigation;

A major U.S. headquartered multinational imaging and photographic film company in commercial and IPR protection matters;

A major U.S. headquartered bowling equipment manufacturer in IPR protection matters;

A major Swiss headquartered multinational luxury goods group company in commercial and IPR protection matters, including administrative enforcement, civil and criminal litigation;

A France headquartered multinational fashion company in IPR protection matters, including administrative enforcement and civil litigation;

An Australia headquartered quarry company in administrative hearing, including zoning, government lobbying and administrative appeals;

A Belgium headquartered multinational construction material company in corporate and commercial, and IPR protection matters;

A leading U.S. headquartered internet information service provider in hacking and criminal litigation matters;

A major Hong Kong headquartered multinational bank in IPR protection matters;
A major U.K. headquartered group company’s Hong Kong subsidiary in unfair competition and IPR protection matters;

A major U.S. headquartered multinational confectionary company in general commercial matters and litigation matters; and

A major Japanese steel manufacturer in investment, corporate and commercial matters.

In additional to being legal counsel to the Hong Kong Chamber of Commerce in China–Guangdong, our attorneys are consulted by the U.S. Consulate General Guangzhou, Australian Trade Commission of the Australian Consulate General Guangzhou, and Hong Kong Trade Development Council for our legal opinions regarding China related matters.

QUALITY OF SERVICES AND FEES

Guangdong United Intellectus Law Firm enables our clients to enjoy legal services of international standard at reasonable charging rates. It further makes it possible for us to upgrade and rationalize our staffing and training, services and expertise, computer networking, legal information and client file management.  This, in turns, leads to a more focused and cost efficient China practice, as we may allocate work based on the expertise and legal skills of our bi-cultural staff rather than on the firm line.

Generally, our professional staff, that is, lawyers and assistant lawyers, will charge fees based on the time spent on the particular legal matter. Their billing rates vary based on the experience and legal skills of the individuals and their rates cover all our charges other than disbursements such as government fees, communication and traveling expenses. Unless instructed by the clients to work overtime, our secretaries will not charge fee for work done during normal office hours.

For budgeting purposes, we can provide our clients with a legal cost estimate or agree to work for a fixed fee in certain matters.

We may require that our clients pay a retainer or deposit some fees to our client accounts prior to the commencement of work. The clients will be billed on a monthly basis at the end of each month.  The balance of the deposit will be returned to the clients once the service is completed.

The lawyers of the association firmly believe that we can, through teamwork, provide our clients with quality full-scale legal services that meet with international standards. For additional information, please contact Ms. Rose Zeng, the coordinator of the association.

Guangdong United Intellectus Law Firm

Add: Room 1501-1502, North Tower,
Guangzhou World Trade Center,
371-375 East Huanshi Road,
Guangzhou, PR China
Direct: (8620) 8762-6262
Tel: (8620) 8769-4790 or 8769-4797
Fax: (8620) 8769-4799
Http://www.uilawfirm.com
Email: gzrose@uilawfirm.com
gzrose@pub.guangzhou.gd.cn

Affiliated Offices
Los Angeles, California
Monterey Park, California
Columbia, South Carolina
Hong Kong, China