Danone decision makers may have already learned the bitter lessons now that in Mainland China, no matter what the overseas partners have talked with their Chinese partners or what documents they have mutually executed, the joint venture agreement, contract, articles of association and their amendments and other documents concerned in writing that have duly been approved by the competent Chinese examination and approval authorities and also duly registered with the competent industrial and commercial administrations(i.e the Company Registry) shall be deemed legally valid and may get the Chinese legal protections. Without governmental approvals in China of the joint venture agreement, contract, articles of association, their amendments and the likes, those agreed-upon and duly executed documents shall not be deemed legally valid and can not get the Chinese legal protections.
With respect to the Danone /Wahaha joint venture, both parties may have no faults to discuss or sign two joint venture contracts at the outsets, if they were willing to do that for whatever reasons, but Danone should not have agreed to deliver the simplified contract to the Chinese authorities for approvals, even though the delivery was probably made by the Chinese partner of Wahaha. Without the prior consents of Danone, however, we do not believe in general that the Chinese partner of Wahaha dared to submit just the simplified contract for governmental approvals, even thoughWahaha might indeed like to do that. The detailed contract, which may stipulate that Wahaha brand should become part of the joint venture assets for their sincere cooperation, can not get legal recognitions and lawful protections in lights of the Chinese foreign joint venture law and its implementations as well as the other foreign investment state policies in writing, which have all clearly indicated that governmental approvals of agreement, contract and articles of association as well as corporate registrations are preconditions for official establishment of a sino-foreign joint venture and for its valid operations.
Therefore, Danone has to swallow its hand-planted bitter fruits to date, because they should have known or should have well been informed of those primary Chinese law, regulations and state policies in writing at the outsets.
2. Danone's then management or then French lawyers or other common law lawyers concerned might probably be liable for its current tough situation or its huge losses
Overseas companies normally like to bring along their home lawyers to expand their business abroad, which is quite understandable and practical, but it does not necessarily mean that their home lawyers and home in-house lawyers can independently act as the overseas lawyers. In this particular case, should Danone fully use Mainland Chinese lawyers all along, apart from using their French lawyers or other common law lawyers who are normally good at drafting and arrangement of commercial documents, etc, they should have avoided the "common-sense" Chinese legal mistakes, or at least, Danone may have one more alternatives to possibly sue its Chinese lawyers for their negligence of work. Or probably, Danone may still sue somebody now and then for their huge loss: then decision-making management or then French or common law lawyers, who could not just make fatty professional fees from the joint venture establishment, but also shall be liable for their possibly negligent mistakes.
3. Danone and Wahaha shall take golden opportunities to make rapid settlements for their various lawsuits in the best interests of Danone
Given that the French and Chinese presidents have recently shown concerns over the Danone / Wahaha series of lawsuits; Danone might have negligent mistakes at the initial stages for agreeing to presenting the simplified contracts for Chinese governmental approvals; Wahaha is a privately-owned enterprise, etc., Wahaha may (1)offer to send a competent negotiating envoy quietly to talk with Mr. Zeng of Wahaha, (2)Danone may also have to prepare to pay more than 4 billions yuan(note: Danone has initially agreed to offer the prices in exchange for the rest firms of Wahaha) to buy back the Wahaha's rest firms, and (3)Denone may take first steps to withdraw all its lawsuits, on the pre-conditions that his single(not too many persons) chief-negotiator envoy has had successful secret contacts with Mr. Zeng of Wahaha and has had preliminary verbal or written agreements regarding mutually major concerns, under such circumstances, both parties may soon announce their close-all-disputes news, which shall be good for Danone in the long terms.
4. Further delay of settlements for all lawsuits could no doubt arouse more attentions of the medias and their readers at home and abroad, and benefit lawyers as well, even though I am also a lawyer, but certainly will damage more of Danone's permanent interests