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October 02, 2015

At Above the Law: Dan Harris on American* hostage-business debtors in China.

This past week there was an especially excellent and eye-opening piece from my fellow Midwesterner and friend (and one-on-one basketball-challenged homeboy) Dan Harris, China business lawyer: "Maybe Owe Money To China? Don’t Go There." As usual from Dan Harris, this Is stuff business law can use. No. Maybe even today. Excerpt:

Most of the hostage cases my firm has handled have involved American businesspeople whose company allegedly owes money to a Chinese company. The American businessperson is being held hostage in an effort by the Chinese company to get paid. Around half the time the American company admits to owing the money, but (quite believably) claims not to have the money to pay off its debt all at once.

The other half of the time, the American company insists that it does not owe the Chinese company anything near the amount claimed by the Chinese company. The disputed amount usually stems from the Chinese company having provided the American company with bad product for which the American company is not willing to pay full price.

The American held hostage usually has had his or her passport taken by the company to whom a debt is allegedly owed and is then kept under fairly loose security in a mid- to lower-tier Chinese hotel, usually in the second- or third-tier city in which the Chinese company is located. After a week or so, the hostage usually comes to realize that he or she is not going to be physically mistreated but by the third or fourth month, they become pretty desperate to get out.

Well done. But it's time for our game, Dan. Hoosier Angels--with jump shots just like mine--walk with me every day.

*And other humans and brands.


Owe money to a China business? Headed there? Don't get boxed-out from your scheduled return. You with me?

Posted by JD Hull at October 2, 2015 11:16 AM


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