Mr. L.M. Schelstraete
Active in the fields of company law and equine law. Within the equine law practice, Luc Schelstraete provides services to Dutch yet often also foreign equine businesses, riders, horse owners and equine authorities.
Mr Luc Schelstraete and Mr Piotr Wawrzyniak of European-US Asian Equine Lawyers attended the first Sino-European Exchange Seminar on equine industry that was organized on 28 April 2016 in Shanghai, China, and would like to report to our readership on its outcome. Usually in this column we write about legal and veterinary cases that we have been dealing with. In today’s column we will though present our readership with an article that goes beyond that. Our article refers to the aforementioned seminar. The seminar was organized parallel to and under the auspices the Longines Global Champions Tour. The seminar aimed to introduce top-level resources and experience in the equestrian industry from Europe through international equestrian events so as to establish a platform of exchange and interaction. The seminar gathered many interesting speakers and was titled “leaping forward”, a title that is very applicable to what China manifested in various fields during the recent decades. The Chinese wish to learn from the experiences of the well-established equine nations in Europe like among others the Dutch and the Germans. The seminar was organized by Cross China New Media (Beijing) Co. Ltd and hosted by Shanghai Juss Event Management Co. Ltd known among others for organizing of the Formula 1 UBS Chinese Grand Prix and the Global Champions Tour in Shanghai.
The seminar showed the growing interest of the Chinese in the equine business and sport. The equestrianism has been developing very fast in the recent years in China. China reported recently a growth of 30 percent when it comes to importing sport horses into China and this growth shall be sustainable. Not without a reason, jockey clubs are being established in many cities across the ainland China. This growing interest was at the same time illustrated by the immense popularity and publicity that was given to the Global Champions Tour in Shanghai. Literally, the whole city of Shanghai lived with the event prior to the weekend on which the GCT event took place. The GCT event was held at the beautiful venue of China Art Museum, one of the landmarks of Shanghai, and attended a lot of visitors from all over China. Equestrianism is associated with luxury lifestyle in China which explains why one of the co-sponsors of the Longines Global Champions Tour in Shanghai was Noblesse, the leading luxury lifestyle magazine in China.
The seminar began with explanation of the Chinese entry and exit policies and the quarantine of sport horses in China that was given by Mr Liu Jinlong, deputy director of animal and plant quarantine division of the General Administration of Quality, Supervision, Inspection and Quarantine of the People’s Republic of China. In this respect it should be noted that the GCT event is very unique for China. The cooperation between the Chinese authorities and the GCT led to creating a special quarantine zone in Shanghai where the horses competing in the GCT were stalled and where any risks related to contacts of with the local horse population were prevented. Such allowed the horses to enter the mainland China prior to the GCT event and to leave such directly after the competition so that they could travel onwards to other GCT events held in other places all over the world. Summarizing the presentations of Mr Yao Congbin, the official veterinarian of the GCT event in Shanghai, and Mr Sin Bin, Deputy Director of Shanghai Animal Husbandry and Veterinary Office, it can be fairly stated that the cooperation between the organization of the event and the Chinese authorities is one of the key success factors of the GCT event in Shanghai. On his turn Mr Martin Atock of Peden Bloodstock explained the complicated logistic process behind the organization of the GCT events around the world and various factors (like for instance time zones, veterinary rules and schedules) that must be taken into account to ensure that the horses are delivered to the venues of the GCT timely and in top condition in order to compete.
In his speech Mr Jan Tops, the founding father of the GCT, enthused the attendants of the conference talking about the basis of the equestrian sport in Europe. Mr Tops in his speech underlined the importance of a good infrastructure and the starting development from the very basis. According to Mr Tops the importance of the local pony clubs and riding school (as known in continental Europe, more in specific in the Netherlands and Germany) should not be underestimated. Developing the interest for the sport among children, letting them to enjoy themselves and to have fun while riding horses is crucial to achieve later successes in the sport. Hard work, dedication and discipline are important factors for a later equestrian career. Mr Tops also underlined the egalitarianism of the equine sport. In the end the equestrian sport is one of the few that lets men and women directly in the same classes.
EUROPEAN CONTINENTAL LAWS
Mr Luc Schelstraete and Mr Piotr Wawrzyniak set out the risk management of doing equine business in Europe discussing trade related issues such as pre-purchase examination, commission, the position of the trainer, disclosure of the seller and the conclusion of the purchase agreement. It must be noted in this respect that due to cultural and legal difference it may be
sometimes quite hard for the Chinese to understand the equine business in Europe, whereby as far as sport horses are concerned, Europe remains the main exporter of them to China. Additionally, the Chinese veterinary regulations make it in many cases – according to the Chinese attendants of the seminar – very difficult if not impossible to return horses back to Europe in the event of any defect or non-conformity of the horse in question. Mr Luc Schelstraete pointed out in his presentation that a possible solution for a such legal and factual problem could be for instance a claim aiming for the reduction of the purchase price or claiming damages. Next to the annulment of the purchase agreement these remedies are also available for a buyer under the European continental laws. Furthermore, Mr Luc Schelstraete pointed out in his presentation that it might be worth considering for the Chinese owners and investors to incorporate a company in Europe in order not only to mitigate the reported problems but also to have the horses bred, stabled, trained and competed in Europe. In this respect also the incorporation process of a legal entity and the VAT related issues were discussed.
Mr Huang Zuping, the former coach of the national team and the competitor of the 2008 Olympic Games together Mr Chang Wei, former Secretary General of the Chinese Equestrian Association, explained the current standing of the equestrian sport in China and underlined the need for creating a pro-found basis for the further development of the sport in China and in order to allow Chinese riders to compete successfully at the very top level in international events. In this respect China needs to sustain
the growth, to invest in riding schools, clubs and to attract know-how by for instance increasing the number of European trainers and/or by sending Chinese riders for education in Europe.
The seminar ended with a panel discussion in which Mr Fred van Lierop, the GCT event director, Mr Chang Wei, Mr Huang Zuping and Mr Luc Schelstraete answered various questions of the attendants and discussed their experiences in the business. Concluding China is making a leap forward in the equestrian business and sport. With new jockey clubs, new venues and equestrian events across the country it is only a matter of time that China will belong to the top of the equestrian nations worldwide. The seminar is to be followed by the second edition next year during the GCT event and we are looking forward to learn and to see how much progress China will make within a year from now.
Piotr M. Wawrzyniak Practicing lawyer at Schelstraete Advocaten in Tilburg (Netherlands)
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