In-house lawyers warned of short-changing themselves on China deals

US participants in Chinese joint ventures routinely think they are making 'easy money' because the Chinese partner often appears to have limited interest in the terms of the main contract - but they could lose out nonetheless, says an expert.

15 July 2015

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Dan Harris of Harris Moure warns parties to Chinese ventures to recognise the 'harm' that they can suffer from not scrutinising carefully the 'side deals' which the Chinese like to add to contracts. Mr Harris says: 'In technology ventures, the common mistake is for the American company to ... give away its key technology to the Chinese investor'. He adds: 'In traditional manufacturing ventures, the common mistake is for the U.S. company to agree to an unattractive long-term supply contract with the Chinese company’s factory.'

World power

The number of such deals with the US is 'rapidly increasing', says Mr Harris in an article in Above the Law. Earlier this year, China also set itself the goal of becoming a world power in robotics within a decade - an aim that is likely to see more joint ventures set up, particularly in areas where it shares technology.

Robotics

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