Last week, I wrote about how Chinese companies use fake investment scams to trick foreign companies into turning over their IP. This post goes into additional detail regarding the China fake investment scam, but it also goes beyond it to ecompass the various IP theft schemes our China lawyers have been seeing in the last couple of years.
That post generated a surprising number of emails from readings wanting to know more about these scams, especially who is getting hit with them and exactly how it is that they go down. This post is a response to those emails.
The era of large scale “take over” type Chinese investment in foreign companies is mostly over. However, our China lawyers still see a lot of interest in smaller investments from China in U.S. and EU companies involved in emerging technologies. Though it is possible this interest from the Chinese side is completely legitimate, much of the time that is not what we are seeing. What we usually see is what our China attorneys have taken to calling “free look schemes”. My previous post focused exclusively on what we call the fake investment scam.
1. Fake Investment Free Look Schemes
The free look investment scheme usually applies to when a Chinese company or individual purports to want to invest in a U.S. or EU company but actually has no interest in a long term investment. Instead, what the Chinese side is seeking is a “free look” The goal of the Chinese side is to investigate the American/European…
