Author: Brian Sanchez

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China’s new wide-ranging cyber security law is drawing some serious apprehension from the U.S. property/casualty insurance industry. Trade associations and experts alike caution that it will create business obstacles in the world’s second-largest economy.

“Most insurers already find China a difficult market in which to get a toehold,” said Michael Barry, vice president of media relations with the Insurance Information Institute, in an emailed statement. “This action will not make things easier.”

As reported by Bloomberg and others, the new law was recently passed by China’s main legislative body, the Standing Committee of the National People’s Congress. It takes effect in June and will implement a number of new requirements, such as mandatory testing and certification of computer equipment. Companies are also required to give government investigators complete access to their data if there is suspected wrong-doing, and Internet operators must cooperate in any national security or crime-related investigation.

In August, 46 global business groups covering finance, information technology, insurance and manufacturing submitted a letter to Chinese Premier Li Keqiang urging that the cyber rules be redrafted, arguing they would hamper trade, Reuters reported. Insurance industry worries remain.

The American Insurance Association “is very concerned about the development on China’s cyber security law,” Steve Simchak, AIA director of Internal Affairs, said in an emailed statement. “We and business associations around the world have communicated our shared concerns, and we hope that there can be a dialogue with the Chinese Government on implementation.”

Dave Snyder, vice president of international policy for the Property Casualty Insurers Association of America, said that his association wants to see further progress with the recently passed regulations.

He noted that the insurance industry, individuals and government all have interests regarding data and that a balance between all three can be achieved.

“We will continue to work with our Chinese counterparts to find an effective balance,” Snyder said. “This should be of interest to the Chinese not only internally but externally. As these [Chinese] companies wish to do business abroad, they too would want to have the right balance of policies applied to them by other countries.”

The I.I.I.’s Barry noted that China appears to want to “gain greater control over its domestic internet activity” in a way that would prompt other nations’ companies “to interact more broadly with Chinese-based firms when storing information and conducting business in China.”

But Barry said that the policies as reported appear to suggest that “China is making it more difficult for non-Chinese firms to do business in China either directly or through partnerships.”

Barry added that while it is too early to say how the new Chinese cyber security law will affect P/C insurance companies, early indications aren’t good.

“P/C insurers will likely see the cost of complying with this new action as a disincentive to conduct business in China,” Barry said.

This article first appeared in Insurance Journal’s sister publication, Carrier Management.

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UK PRIVATE equity businesses are holding out hope for growth in their sector in the post-Brexit world, according to new research from Mourant Ozannes.

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In a week filled with passing new laws, China’s top legislature also made time on Monday to adopt a new set of regulations concerning the film industry which will impose penalties on box office fabricators and help to insure that movies better serve the state and socialist values.

The new film industry law was approved by the National People’s Congress (NPC) Standing Committee at the end of their latest busy session in Beijing. It states that film agencies and theaters caught inflating box office numbers will have their illegitimate earnings confiscated and be fined up to 500,000 yuan. If the film managed to take in more than 500,000 yuan in ill-gotten gains, that penalty could then become as much as five times their illegal earnings. Depending on the severity of the situation, the guilty firms could also have their operations suspended.

This kind of fraud is rampant in China where hyping big box office numbers has become one of the most effective strategies for promoting a film. Last year, broadcasters gave out over 40 million free tickets to help make the domestic animated blockbuster “Monster Hunt” China’s top grossing movie of all-time (it has since been passed by Stephen Chow’s “The Mermaid”). Earlier this year, the distributor of “Ip Man 3” was suspended after it was found that they had inflated the film’s box office numbers by 88 million yuan through some creative accounting and simply buying up tickets.

In addition to cracking down on box office fraud, the new law also promises to take an even closer look at the content of films before they are released to the public. Currently, only 34 foreign movies are allowed to be shown on Chinese screens each year (though somehow a few extra slipped in this year). The competition to be one those lucky films is intense. In order to please Chinese audiences and censors, Hollywood has been known to go to great lengths, cutting out scenes of aliens blowing holes in the Great Wall of China and adding in unnecessary ones featuring Fan Bingbing.

To help out Hollywood, the new law includes a long list of things that will get a film banned on the mainland, including content that “jeopardizes national unity, sovereignty and territorial integrity, releases national secrets, endangers state security, damages national dignity, honor and interests, or advocates terrorism and extremism,” according to a report from China’s official Xinhua News Agency.

At the same time, the regulation hopes to promote domestic films that “champion excellent Chinese culture and socialist core values.”

In order to get around the film quotas, Hollywood companies have begun to partner with domestic groups to make movies that won’t technically count as foreign films. The new law warns Chinese film companies against cooperating with overseas organizations and individuals that engage in “activities damaging China’s national dignity, honor and interests, or harming social stability or hurting national feelings.” Looking at you, Brad Pitt.

Finally, the law specifies that actors and directors ought to be “excellent in integrity and film art” while maintaining self-discipline and building a positive public image. Looking at you, Jaycee Chan.

The whole thing will go into effect on March 1st, 2017.

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Laws in Australia that prevent whistleblowers speaking out or leave whistleblowers open to retaliation from the companies accused of wrongdoing need to be changed, according to the lawyer running the class action on behalf of Christmas Island detainees.

Maurice Blackburn principal Andrew Watson said he supported bringing in a US-style system that protects whistleblowers from the backlash of their employer and provides anonymity to those speaking out about wrongdoing.

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The call for better whistleblower protection

Whistleblowers who call out corporate corruption in America receive government payouts, but those in Australia face unemployment and an uncertain future.

The US system also allows the corporate watchdog the Securities Exchange Commission to pay bounties to whistleblowers if their tip leads to a fine of more than $1 million being issued.

“In the context of a class action on behalf of Christmas Island detainees, Maurice Blackburn has had to obtain orders from the court in order to speak to whistleblowers without the threat of criminal sanctions,” Mr Watson told the Maurice Blackburn Fairfax Media Class Action Symposium in Sydney.

“In a properly functioning system this should not be a matter requiring a crafted and specific court order but something dealt with by way of general policy,” Mr Watson said.

Whistleblowers should also be able to go to class action firms so victims of illegal behaviour could have some recourse, he said.

It’s a view not shared by a senior lawyer who has represented several corporate defendants in class actions.

Jenny Campbell said she disagreed with Mr Watson’s call to extend whistleblower disclosure to class action firms, as opposed to a corporate regulator.

 “The fact is the law has over many many years enshrined the principle that an employee who receives confidential information in the course of their employment is under an obligation to maintain that confidentiality,” Ms Campbell said.

“I struggle with the concept of being able to disclose one private entity’s information to another private entity. And that is what a disclosure to a class action firm would be,” she said.

Maurice Blackburn principal Josh Bornstein, who has represented whistleblowers in Fair Work cases,  said whistleblowers often came to Maurice Blackburn because the Australian Securities and Investments Commission was so under resourced.

“Organisations should not be able to contract out of accountability for unlawful conduct and invoke their contracts with staff to silence them to stop that illegal conduct being ventilated,” Mr Bornstein said.  

Mr Watson’s and Mr Bornstein’s calls for greater whistleblower protections in Australia was supported by Labaton Sucharow partner Jordan Thomas, who is also a former SEC prosecutor.

Mr Thomas said Australia’s current whistleblowing laws mean that “good guys” who call out wrongdoing by corporate entities are afforded fewer protections than those who have broken the law to participate in a cartel, the conference has heard.

“It strikes me as a little inconsistent,” Mr Thomas said.

“If it’s OK to incentivise them to dob when they’re bad guys, how about doing it for people who are good guys?”  

Under Australian law, there are no real protections for whistleblowers of corporate wrongdoing, unless that whistleblower has participated in a cartel.

In those instances, a cartel participant can seek immunity if they reveal their illegal activities to the Australian Competition and Consumer Commission 

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Laws in Australia that prevent whistleblowers speaking out or leave whistleblowers open to retaliation from the companies accused of wrongdoing need to be changed, according to the lawyer running the class action on behalf of Christmas Island detainees.

Maurice Blackburn principal Andrew Watson said he supported bringing in a US-style system that protects whistleblowers from the backlash of their employer and provides anonymity to those speaking out about wrongdoing.

More News Videos

Previous slide
Next slide

The call for better whistleblower protection

Whistleblowers who call out corporate corruption in America receive government payouts, but those in Australia face unemployment and an uncertain future.

The US system also allows the corporate watchdog the Securities Exchange Commission to pay bounties to whistleblowers if their tip leads to a fine of more than $1 million being issued.

“In the context of a class action on behalf of Christmas Island detainees, Maurice Blackburn has had to obtain orders from the court in order to speak to whistleblowers without the threat of criminal sanctions,” Mr Watson told the Maurice Blackburn Fairfax Media Class Action Symposium in Sydney.

“In a properly functioning system this should not be a matter requiring a crafted and specific court order but something dealt with by way of general policy,” Mr Watson said.

Whistleblowers should also be able to go to class action firms so victims of illegal behaviour could have some recourse, he said.

It’s a view not shared by a senior lawyer who has represented several corporate defendants in class actions.

Jenny Campbell said she disagreed with Mr Watson’s call to extend whistleblower disclosure to class action firms, as opposed to a corporate regulator.

 “The fact is the law has over many many years enshrined the principle that an employee who receives confidential information in the course of their employment is under an obligation to maintain that confidentiality,” Ms Campbell said.

“I struggle with the concept of being able to disclose one private entity’s information to another private entity. And that is what a disclosure to a class action firm would be,” she said.

Maurice Blackburn principal Josh Bornstein, who has represented whistleblowers in Fair Work cases,  said whistleblowers often came to Maurice Blackburn because the Australian Securities and Investments Commission was so under resourced.

“Organisations should not be able to contract out of accountability for unlawful conduct and invoke their contracts with staff to silence them to stop that illegal conduct being ventilated,” Mr Bornstein said.  

Mr Watson’s and Mr Bornstein’s calls for greater whistleblower protections in Australia was supported by Labaton Sucharow partner Jordan Thomas, who is also a former SEC prosecutor.

Mr Thomas said Australia’s current whistleblowing laws mean that “good guys” who call out wrongdoing by corporate entities are afforded fewer protections than those who have broken the law to participate in a cartel, the conference has heard.

“It strikes me as a little inconsistent,” Mr Thomas said.

“If it’s OK to incentivise them to dob when they’re bad guys, how about doing it for people who are good guys?”  

Under Australian law, there are no real protections for whistleblowers of corporate wrongdoing, unless that whistleblower has participated in a cartel.

In those instances, a cartel participant can seek immunity if they reveal their illegal activities to the Australian Competition and Consumer Commission 

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The government will impose tougher penalties on companies that make employees work beyond the overtime limit agreed on with the labor side, sources said Tuesday.

In view of the labor ministry’s search the same day of Dentsu Inc. over the high-profile work-related suicide by a freshman female worker of the major advertising agency, the government concluded that it must take more effective measures to prevent excessive overtime work, the sources said.

As part of its work style reform initiative, the government aims to draw up specific action plans by March and introduce relevant legislation during the ordinary session of the Diet next year, they said.

The Labor Standards Act stipulates eight work hours a day and 40 hours a week. But companies may let employees work up to 45 hours of overtime a month and 360 hours a year if they conclude pacts with labor unions under Article 36 of the law.

Experts point out that the overtime regulations are virtually meaningless because the extra work hours may be extended further if management gains consent from the labor side.

Dentsu set its overtime limit at 70 hours a month under its “36” pact with the union. But the ministry suspects the company forced some employees to work more than 100 hours of overtime a month, but made them report overtime slightly shy of the 70-hour limit.

To prevent these illicit acts, the government is considering raising fines set by the law from the current ¥300,000 at most, the sources said.

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NEW YORK, Nov. 8, 2016 /PRNewswire/ — Pomerantz LLP is investigating claims on behalf of investors of Exxon Mobile Corporation (“Exxon” or the “Company”)
XOM, +0.72%
(isin:US30231G1022). Investors are advised to contact Robert S. …
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