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franchising china

On January 17 the World Economic Forum (WEF) took place in the Swiss Ski resort of Davos. For the first time ever, the Chinese President Xi Jinping attended this event. This year‘s Forum is still a little different to the ones in previous years. Originally, the WEF ran under the theme, that Globalization has the potential to benefit everyone. With Brexit and Trump becoming the new elected president of the United States, there is a clear tendency towards more protectionism. In direct contrast to that is the vision of Xi Jinping. He sees China having a leading role in the global market.

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In 2016, Chinese investors have spent around 11.6 billion Euro for the purchase of German companies – twenty times the amount, which had been invested in previous years. 

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On 1 January 2017, a new Grading Evaluation of Compliance and Integrity of Enterprises’ Labor Protection has officially entered into effect. The new regulation was issued on July 25, 2016 by the Ministry of Human Resources and Social Security (MOHRSS). The Grading Evaluation sets out new requirements for enterprises, and implements an annual evaluation system for compliance. The reform also introduces an enterprise classification system. It will apply to both domestic and foreign employers.

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On 30 December 2016, China’s National Reform and Development Commission (NRDC) announced 20 measures to attract more foreign direct investment (FDI).

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With China’s growth slowing, the question of layoffs and employment contract termination has become an important issue for many companies. In China, as elsewhere, layoffs and factory closures are a sensitive topic, and Chinese authorities and even local government usually keep a watchful eye on these issues, since they might easily threaten social order.

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franchising china

During the last 20 years of rapid growth, more and more franchisors, both Western and local, have entered the Chinese market. Franchising is a common practice by which a company (or franchisor) is granting another entrepreneur (or franchisee) the right to use the franchisors business brand for a fixed period of time.

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