Virginia Newman Comments on China's Recent Actions Against Consultancies and Due Diligence Firms in The Wire China
"Beijing's Latest Crackdown Deepens Foreign Business's Confusion"
The Wire China
Virginia Newman discussed how Beijing's latest crackdown on consultancies and due diligence firms is making it harder for multinational companies to operate in China. Recently, Chinese authorities have reportedly raided the offices of, or began investigations into, several consultancies that advise multinationals on doing business in China. The crackdown has led to concerns that U.S. and multinational companies will be effectively unable to conduct routine (and non-routine) due diligence on Chinese companies for purposes of legal compliance, which in turn will increase the difficulty of conducting business in the country. "This is the question at the heart of the issue: Is it possible to operate in China in accordance with your home country's laws, if compliance activities in China are restricted?" Newman said. "Every single company that has operations or supply chains in China is to some extent asking that question right now."