Belt and Road Initiative

Name: Belt and Road Initiative | Legal Risks and Opportunities Facing Chinese Engineering Contractors Operating Overseas
Brand: Kluwer Law International
Price: 173.99 EUR
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Legal Risks and Opportunities Facing Chinese Engineering Contractors Operating Overseas

Permanent Forum of China Construction Law(Herausgeber*in)

Kluwer Law International (Verlag)

Erschienen am 22. August 2019

264 Seiten

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Beschreibung

The ';Belt and Road' initiative, designed to enhance trade flows and spur long-term regional economic growth through infrastructure projects, has expanded China's overseas construction market. This book, written by prominent adjudicators, lawyers, scholars, entrepreneurs and consultants with extensive first-hand experience in global construction matters will assist Chinese contractors in identifying, managing and mitigating the inherent risks involved, including those arising from the political, social, economic and legal contexts of the foreign jurisdiction. Drawing on real-life experiences of project managers, lawyers, arbitrators and othersand including summaries of both successful and unsuccessful casesthe book comprehensively covers the variety of risks facing Chinese contractors of international engineering projects and provides useful advice on how to address them. The issues and topics covered in this book are: understanding the political, social and market environment of the host country; cost and scheduling impacts of host country regulation; dispute resolution mechanisms; site security; health and medical environment; availability of local goods and materials; appointment of local subcontractors; public relations and social responsibility; and insurance. Questionnaires and interviews covering a wide variety of Chinese overseas construction projects provide expert perspectives on risk analysis and management, best practices, precautions, issues to be adjudicated in arbitrations and much more. Addressing all the practical difficulties and problems encountered before and during an overseas construction project, the book will help in-house counsel for Chinese enterprises and those who interact with them improve management, reduces risks, and protect rights and interests. It will also serve as a general guide for international engineering contractors, given that the risks Chinese enterprises face in their overseas operations are shared by their international counterparts. Others welcoming this book include international lawyers, scholars and researchers specializing in construction law, arbitrators, arbitral institutions and international project owners.

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Inhalt

Intro
Half-Title Page
Title Page
Copyright Page
List of Contributors
Table of Contents
Forewords
Preface
Introduction
Chapter 1 Political, Social and Market Environment of the Country
§1.01 POLITICAL RISKS
[A] War
[B] Economic Sanctions
[C] Domestic Regime Change
[D] Expropriation
[E] Bilateral Relationship
[F] Prevention of Political Risks
§1.02 SOCIAL RISKS IN HOST COUNTRIES
[A] Social Security (Terrorist Activities, Kidnapping)
[B] Religious and Cultural Differences
[C] Environmental Protection Risks
[D] Work Habits and Efficiency of Local Employees
[E] Social Risks Prevention
§1.03 HOST COUNTRY MARKET RISKS (THE MARKETIZATION LEVEL IN THE LOCAL ECONOMY)
[A] Macroscopic Investigation of Market Environment and Risk
[B] Availability of Local Resources
[C] Market Risks Prevention
Chapter 2 Legal Environment in Host Countries
§2.01 WORK VISA
[A] Quota and Duration of Visa
[B] Adverse Impact of International Politics on Obtaining Visa
[C] Avoid Illegal Labor
[D] Other Certificates or Certifications
[E] Prevention and Allocation of Risks Related to Work Visas
§2.02 CUSTOMS CLEARANCE
[A] Focus on Logistics and Customs Clearance in EPC Project Procurement
[B] Understand in Advance the Product Admittance Criteria of the Project Country
[C] Check Whether Any Special Certificate Is Required
[D] Try to Avoid Customs Clearance in Any Red Light Period
§2.03 MARKET ACCESS
[A] Qualifications
[1] System for Obtaining a License for U.S. Contractors
[2] The Registration System for UK Project Contractor
[3] System of License for Project Contractors in Japan
[B] Admittance of Foreign Contractors
[1] Kazakhstan Construction Market Access: Joint Venture System
[2] "Kazakh Content" System
[3] Russian SRO System
[C] Admittance of Individuals
[1] License System in the U.S.
[2] Review Engineer System in Germany
[3] Work Permit System in Kazakhstan
[4] Work Permit System in Thailand
[D] Risks in Commercial Registration
[1] Risks Factors to Be Considered When Choosing the Form of Commercial Entity
[2] Procedural Risks in Completing Entity Registration in Host Country
§2.04 CONTROL OF FOREIGN EXCHANGE
[A] Compliance with the Laws of the Host Country
[B] Try to Obtain an Appropriate Proportion of Transferrable Contract Amount at the Time of Execution of Contract
[C] Be Prudent When Considering African Projects
[D] Pay Special Attention to the Countries Sanctioned by the U.S.
§2.05 TAXATION SYSTEM
[A] Double Taxation Treaties
[1] Implementation of Double Taxation Treaties
[2] Difference in the Judgment of the Nature of Income or Source of Income
[3] Tax Discrimination
[4] Designation of a "Permanent Establishment"
[5] Collection of Engineering Equipment Income Tax
[6] Denial of Global Transfer Pricing Policy
[B] Stability of Taxation Regime
[1] Tax Laws in Central Asian Countries
[2] Tax Laws in African Countries
[3] Tax Laws in South Asian Countries
[4] Tax Discrimination
[5] New Risks from BEPS Action Plan
§2.06 ADMINISTRATIVE PERMIT
[A] Obtaining Construction Permits
[B] Confirm the Requirements of the Project Entity as Soon as Possible
§2.07 LABOR ISSUES
[A] Labor Issues Vary from Region to Region
[B] Risk of Employment Relationship Termination
[C] Risk of Labor Policy Limit
[D] Risk of Strike
§2.08 OCCUPATIONAL HEALTH, SAFETY AND ENVIRONMENT
[A] Strict Environmental Protection System of Oil-Producing Countries in Central Asia
[B] Risks from Strict Environmental Protection Systems in Central and Eastern European Countries
§2.09 DISPUTE RESOLUTION SYSTEM
[A] Selection of Dispute Resolution Method
[1] The Right of the Parties to Select
[2] Friendly Negotiation
[3] Mediation
[4] Adjudication
[5] Arbitration
[a] Arbitration Agreement
[b] Selection of Arbitration Language
[c] Choice of Arbitration Institution
[d] Risk of Convenience in Extraterritorial Enforcement of Arbitral Award
[e] Expert Witnesses
[f] Actively Participating in the Arbitration
[B] Choice of Law
[C] Risk Prevention in Choosing the Dispute Resolution Method
§2.10 INVESTMENT DISPUTES RESOLUTION
[A] The Impact of International Conventions on the Enforcement of Judgments
[B] The Impact of Host Country's Domestic Law on Investment Dispute Resolution
[C] The Act of a Foreign Contractor Providing a Performance Bond or Importing Equipment to the Host Country Employer May Be Considered an Investment
[D] In the Expansion of Overseas Markets, State-Owned Enterprises Are Also Eligible Investors
[E] Restrictions of Host Country on Choice of Law
[F] Suggestions to Chinese Contractors in Investment Arbitration
Chapter 3 Risks of Project Stakeholders
§3.01 CREDIT AND MANAGEMENT LEVEL OF EMPLOYERS
[A] Transferring Risks to Contractors in Contract Conditions
[B] Employer's Payment
[C] Employer's Credit Risk
[D] Employer's Excessive Interference
[E] Assignment of Contract by the Employer
[F] Management of Risks Related to the Employer
§3.02 THE EMPLOYER'S REPRESENTATIVE/ENGINEER
[A] Low Efficiency in Examination and Approval
[B] Inadequate Capability and Experience
[C] Engineer's Fairness
[D] Worsening of Relations
§3.03 FINANCING AND GUARANTEE AGENCIES
[A] Financing Agencies
[B] Guarantee Agencies
§3.04 LOCAL CONSULTANTS
[A] Providing False Information
[B] Violation of the Confidentiality Agreement
[C] Mitigating Risks of Local Consultants
§3.05 PARTNERS OF THE JOINT VENTURE
[A] The Risks of Noncompliance by Partners
[B] The Risk of Improper Type of Joint Venture
[C] The Risk of Unclear Work Scope
[D] The Risk of Guarantee Extension
[E] The Risk of Impure Motives of Forming Joint Ventures
[F] Mitigating Joint Venture Risks
§3.06 NOMINATED SUBCONTRACTORS
[A] Poor Compliance Capability of Nominated Subcontractors
[B] Managing Risk of the Nominated Subcontractors
§3.07 OTHER SUBCONTRACTORS
[A] Subcontractor's Weak Performance Capability
[B] Risk of Re-subcontract Wholly
§3.08 SUPPLIER OF MASTER EQUIPMENT AND MATERIALS
[A] Weak Capability to Perform the Contract by Suppliers
[B] Moral Hazard of Suppliers
[C] Risk of Supplier's Bankruptcy
[D] Cost Risk
§3.09 COMPETITORS
[A] Low-Price Bidding Risk
[B] The Gap Between Chinese and Foreign Contractors
§3.10 PUBLIC RELATIONS
[A] Host Government
[B] Political Factions
[C] Community Relations
[D] Influence of Public Media
Chapter 4 Project Risks
§4.01 PROJECT FEASIBILITY
[A] Technical Feasibility
[B] Differences in Technical Standards and Specifications
[C] Availability of Materials and Equipment
[D] Credit Status of the Employer
[E] Availability of the Funds Required for the Project
[1] Major Financing Methods for Overseas Contracting Projects
[2] The Choice of Financing Methods
[3] Risk Management of Project Funds
§4.02 CLIMATIC CONDITIONS RISKS
[A] Normal Local Climatic Conditions
[B] Abnormal Climatic Conditions
[C] Preventive Measures
[1] Environmental Investigation in the Early Stage
[2] Risk-Sharing Mechanism in the Contract
[3] Claims in Performance Phase
§4.03 GEOLOGICAL CONDITIONS AND SITE DATA RISKS
[A] On-Site Topographic Conditions
[B] Geological Features
[C] Preventive Measures
§4.04 RISKS IN LAND ACQUISITION AND REMOVAL
[A] Overview of the Risk
[B] Coping Mechanism
[1] Background Investigation of the Host Country
[2] Precautions to Take During Contract Negotiation Stage
[3] Actions to Take After the Occurrence of Site Risks
§4.05 PRICE RISK
[A] Risks Worthy of Consideration in Making a Bid
[1] Risks in Miscomputation and Omissions
[2] Risks in Miscomputation of Quantities
[3] Risks in Rising Prices and Inflation
[4] Risks Caused by Changes in Legislation
[5] Risks in Currency Exchange
[B] Preventive Measures for Price Risks
[1] Price Adjustment in Lump-Sum/Fixed Unit Price Contract Price
[2] Principle of Changes in Circumstance/Principle of Contract Frustration
§4.06 DESIGN RISKS
[A] Design Capability Risk
[B] Uncontrollability Risk of Local Design Institute
[C] Delay Risks in Overdue Design Submittal and Approval
[D] Risk in Defective Design Drawings
[E] Risk in Attribution of Design Liabilities
[F] Risk in the Limited Flexibility of Contractor
[G] Risk in Application of Varied Specifications and Design Standards
[H] Risk in Government Examination and Approval
[I] Risk in Application of Mock-Up
[J] Risk in Design Modification
[K] Risk in Insurance
§4.07 TRANSPORTATION RISKS
[A] Characteristics of Logistics Management in Overseas Contracting Projects
[B] Transportation Contract
[1] Limitation of Carrier's Liability
[2] Release of Goods Without the Original Bill of Lading
[C] Customs Clearance
[1] Domestic Customs Clearance
[2] Foreign Customs Clearance
[D] Traffic Conditions of the Host Country
[E] Establishment of a Modern and Holistic Logistics Management System
§4.08 VARIATION RISKS
[A] Analysis on Legal Risks of Variation
[B] Prevention of Variation Risks
§4.09 RISKS IN PROJECT DELAY
[A] Principal Causes and Liability Attribution of Project Delay
[B] Risks in Provisions for Project Time Worthy of Special Attention
[1] Clarity of Commencement Time and Completion Time
[2] Rationality of the Arrangement for Project Time and Liquidated Delay Damages
[3] Conditions for Extension of Time and Procedures
[C] Critical Path Analysis
[D] Concurrent Delay
[E] Evidence Management
[F] Retaining Evidence in Common Situations of Delay
[G] Claim Procedures for Delay
§4.10 RISK OF SUSPENSION AND TERMINATION
[A] Conditions for Project Suspension
[B] Conditions for Contract Termination
[C] How to Avoid Suspension and Termination from the Perspective of Chinese Contracting Enterprises
[D] How to Cope with Suspension and Termination from the Perspective of Chinese Contracting Enterprises
§4.11 RISKS OF INDEPENDENT LETTER OF GUARANTEE
[A] Legal Source of Independent Letter of Guarantee
[B] Features of Independent LG
[C] Several Common Forms of Guarantee, Their Risks and Prevention of Payment
[D] Risks of Fraudulent Claim and Its Prevention
[1] Reasons of Risks
[2] Determination on Fraudulent Claim by Chinese Courts
[3] Preventive Measures
[E] Risks in the Issuance of Guarantee and Its Prevention
[1] Reasons for Risks
[2] Preventive Measures
[F] Risk in Guarantee Provisions and Its Prevention
[1] Validity Provision
[2] Governing Law and Dispute Resolution Provisions
[G] Demand Guarantee
[1] Guarantee Amount
[2] Transferability
[3] Reduction of Guarantee Amount
[4] Period of Validity
[5] Dispute Resolution
[6] Beware of Bad Faith Demand
[7] The Applicant's Approach to Deterring Demand
§4.12 PARENT COMPANY GUARANTEE
[A] Emergence of Parent Company Guarantee
[1] The Increased Scale of Overseas Projects and the Relatively Insufficient Credit of Contractors
[2] From "Prior Approval" to "Registration System": Clear the Way for Parent Company Guarantee
[3] Parent Company Guarantee Becomes the Safeguard of Financing for Foreign Employers
[B] Forms of Parent Company Guarantee and Their Disadvantages
[1] Forms of Parent Company Guarantee
[2] Disadvantages of Parent Company Guarantee
[a] Parent Company Guarantee May Not Fulfill the Needs to Circumvent Overseas Risks
[b] Parent Company Guarantee Will Increase the Burden of Parent Companies Which Will Affect the Follow-Up Investment and Financing Ability
[c] A Listed Parent Company Is Required to Disclose the Information of Financial Guarantee It Provides to Its Subsidiaries
[C] Risks Prevention on Parent Company Guarantee
§4.13 COMPLETION AND TAKING-OVER
[A] Risks in the Bidding Stage
[1] Definiteness of the Time for Commencing Work
[2] Reasonableness of the Construction Period and Liquidated Damages for Delay
[3] Specificity of the Conditions and Time Limit for Completion and Taking-Over
[B] Risks in the Construction Stage
[C] Risks in the Completion and Taking-Over Stage
§4.14 DEFECTS LIABILITY
[A] Features of Defects Liability Period
[B] Difference Between Defects Liability Period and Warranty Period
[C] Extension and Upper Limit of Defects Liability Period
[D] Ten-Year Liability Insurance
§4.15 LIQUIDATED DAMAGES
[A] Limitation on Liability of the Contractor
[B] Delay Penalties
[C] Interest of Delay Payment
§4.16 INSURANCE
[A] Necessity of Taking Out Insurance
[1] Concerns of Risk
[2] Concerns of Financing
[B] Types of Insurance
[C] Essential Points in Insurance Policy
[D] Suggestions
§4.17 FORCE MAJEURE
[A] Overview of Force Majeure
[1] Definition of Force Majeure
[a] PRC Law
[b] FIDIC Conditions of Contract
[2] Consequences of Force Majeure
[a] Claims in the Event of Force Majeure
[b] Contractor's Obligation to Send Notice
[c] Contractor's Duty to Minimize Delay
[d] Limits to Force Majeure Clause
[e] Change and Rescission of Contract
[B] Response to Force Majeure Risks
[1] Recognition as Force Majeure
[2] Specification of Force Majeure Clause
[3] Prevention of Subcontracting Risks
[4] Response after Force Majeure
§4.18 FAILURE TO SUBMIT CLAIMS WITHIN THE TIME PERIOD PRESCRIBED UNDER THE CONTRACT
[A] Causes of the Risk
[B] Statute of Limitation under FIDIC Contract Conditions
[1] 1999 FIDIC Contract Conditions: Rules and Analysis
[2] 2017 FIDIC Contract Conditions: Rules and Analysis
[C] Preventive Measures for Risks of Statute of Limitation
[1] Submit Notice of Claim and Other Documents in Time
[2] Determine the Claim Event and the Timing of Its Occurrence Correctly
[a] Determine the Claim Event
[b] Determine When Claim Events Occur
[3] Standardize Formality and Content of the Notice of Claim
[4] Beware of Special Requirements in the Contract
Chapter 5 Internal Risks of Contractors
§5.01 RISKS OF MANAGEMENT DECISION
[A] Risks of National Markets' Selection
[1] About "the New York Convention" (1958)
[2] About "the Washington Convention" (1965)
[3] Sino-Foreign Bilateral Investment Protection Agreement
[B] Risks of Dealing with Relations Between Political Interests and Marketing Interests
[C] Risks of Operating Cross-Profession Projects
[D] Risks of EPC Capacity Developing Path
[1] Cultivate an International Talent Team by Professional Subcontracting
[2] Joint Venture Contracting
[3] Micro-Investment and Micro-Financing Promote General Contracting
§5.02 COMPLIANCE RISK
[A] Present Situation and Development Trend of Domestic and Foreign Compliance Supervision
[B] "Three Levels" in the Construction of Compliance System and Practical Suggestions
[1] The First Level in Construction of Compliance System: Institutional Deficiency and External Barriers in the Compliance Department
[a] Institutional Deficiencies of the Compliance Department
[b] External Barriers of the Compliance Department
[2] The Second Level in Construction of Compliance System Grasp the Main Risk Points
[3] The Third Level in Construction of Compliance System: Implementation and Enforcement
[a] Tests of Compliance Rules' Implementation
[b] Propaganda of Enterprises' Culture
§5.03 INTERNAL ORGANIZATIONAL MANAGEMENT AND AWARENESS OF RISKS
[A] Risks of Capacity of Managing Contracts
[B] Risks of Stereotyped Thinking Pattern and Empiricism
[C] Risks of Not Being Good at Getting Help from "Outside Brain"
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