As more and more countries are opening up to Western trade, there is an influx of securities and related litigation matters, often requiring professional translation services. A prime example is China. As more and more of its products come to foreign shores, it is beginning to feel the pressure put on by a foreign legal system. In other words, when a Chinese product or company has connections to the U.S., it can quickly become snared in the U.S. legal system – which is an entirely different dragon to what China is used to.
A prime example is China Life, a leading Chinese insurance company that debuted on the New York stock exchange with a substantial public offering in 2003. Soon after its introduction, a class action lawsuit was filed against the company for failure to disclose financial fraud in its disclosure documents. Needless to say, that suit has had a profound impact on the expansion of Chinese companies in foreign markets.
Of course, this works the other way too. When a U.S. company goes public in a foreign country it, too, exposes itself to that country’s securities laws. So what does this mean to the securities practitioner? It means that foreign securities laws must be fully understood and analyzed – using foreign language translators familiar with the language of the foreign jurisdiction. The foreign language translation must occur as a preliminary measure ensuring a company’s compliance capabilities. Trying to conduct a foreign language translation after a suit is filed is too late.
See Sandburg, Brenda. “Culture Shock.” ALM, Litigation 2006.
Up Next: Legal Document Translations for Lawyers, Attorney-Client Privilege and Foreign Companies in U.S. Courts