Legal Bodies
June 22, 2016 11:15 AM   Subscribe

China has very strict controls on moving money out of the country. China's new president, Xi Jinping, has been cracking down on corruption at the highest levels, consolidating his control over the government. What to do if you're a corrupt official worried you may find yourself on the wrong side of the new regime? Buy a Japanese son. Japanese surrogacy ring producing Japanese-citizen babies for Chinese nationals: Part 1, Part 2
posted by Diablevert (17 comments total) 7 users marked this as a favorite
 
Lest anyone think this is the start of a massive wave of capital outflows-via-surrogacy, "according to the records, a total of 86 children have been born via surrogacy since the business was launched. Of those, 28 are being taken care of at child care centers and elsewhere in Japan, and 58 have been taken to China."
posted by Atrahasis at 11:21 AM on June 22, 2016


Better be nice to those kids...
posted by Naberius at 11:22 AM on June 22, 2016


It's interesting to speculate on what the world would be like if the Yuan floated freely or at least somewhat freely. THis would make some of this capital flight less of a big deal mostly because the Yaun would probably fall considerably and there'd be less Chinese buying power. That said, a lot (all?) of these people never had their assets in Yuan to begin with.
posted by GuyZero at 12:03 PM on June 22, 2016 [1 favorite]


I don't get how this works. If the Japanese surrogate and some other guy (but not the child's genetic parents) are legally the parents in Japan, then what use will the child's Japanese citizenship be if China collapses? Sure the kid can go to Japan, but they can't claim their parents or other relatives since as far as Japan is concerned, those people aren't its relatives.

Also, 28 aren't even with their parents? So they're just making babies and fostering them out and expecting that in a couple of decades or more those kids are going to want to bail them out of trouble?
posted by If only I had a penguin... at 12:04 PM on June 22, 2016 [1 favorite]


I don't get how this works. If the Japanese surrogate and some other guy (but not the child's genetic parents) are legally the parents in Japan, then what use will the child's Japanese citizenship be if China collapses? Sure the kid can go to Japan, but they can't claim their parents or other relatives since as far as Japan is concerned, those people aren't its relatives.

It's not about getting visas, residency, or citizenship. That's the (relatively) easy part. The hard part is getting assets out from under the thumb of and out of the reach of the CPC.
posted by Talez at 12:06 PM on June 22, 2016


So those 28 families who aren't raising the kids imagine that those kids who were conceived only for bureaucratic convenience and farmed out to raise are going to withdraw the money in Japan and hand it over?
posted by If only I had a penguin... at 12:07 PM on June 22, 2016


So those 28 families who aren't raising the kids imagine that those kids who were conceived only for bureaucratic convenience and farmed out to raise are going to withdraw the money in Japan and hand it over?

No. There's a wink, wink, nudge, nudge understanding with the Japanese branch manager and the Chinese family retain control over the account. Did you even read the articles?
posted by Talez at 12:10 PM on June 22, 2016


It may work now because no-one's noticed it going on, but how could anything the parents try based on this scheme possibly stand up before a judge? Wouldn't they lose either the child's citizenship or any control over assets in the child's name at the slightest legal challenge?

To say nothing about the horrifying idea of people leaving newborn babies in third-party care in another country for a year or more, just to protect their money...
posted by ormon nekas at 12:20 PM on June 22, 2016


(I have no training in Japanese law, but I thought that Japanese judges, as in other civil-law systems, were allowed a measure of discretion to decide in favour of the spirit of the law when things get egregious)
posted by ormon nekas at 12:26 PM on June 22, 2016


> In the world of Tokyo's underground surrogacy business, based in Shinjuku Ward's Kabukicho district, the child's biological parents are the Chinese couple who request surrogacy.

If the next sentence referred to a sentient AI, early-nineties William Gibson could have filed a copyright infringement suit.
posted by RedOrGreen at 12:26 PM on June 22, 2016 [2 favorites]


No. There's a wink, wink, nudge, nudge understanding with the Japanese branch manager and the Chinese family retain control over the account. Did you even read the articles?

I did. I took the understandings to be about the huge amounts of unaccounted for money in the possession of infants (i.e. taxes and possible money laundering), not about how ultimately owned and controlled the money, especially once the kids are adults.
posted by If only I had a penguin... at 1:02 PM on June 22, 2016


Lest anyone think this is the start of a massive wave of capital outflows-via-surrogacy, "according to the records, a total of 86 children have been born via surrogacy since the business was launched. Of those, 28 are being taken care of at child care centers and elsewhere in Japan, and 58 have been taken to China."

Right, but this is only one surrogacy business- there are probably more copycats. And it sounds like each child can carry the accumulated fortunes of entire families in their name, so it could be quite a lot of money.
posted by BungaDunga at 1:18 PM on June 22, 2016


It's not clear to me from the articles what advantages there may be in keeping the kids in Japan, but it seems like in most of these cases the Chinese families do eventually intend to care for and integrate these kids into their family. There may be some advantage to keeping the kid in Japan temporarily in order to fascilitate funnelling money out, or in order to make it easier for the families to ditch China if things go bad at home. I didn't have the sense that the Chinese families were planning to let the kid grow to adulthood on their own in Japan.
posted by Diablevert at 1:21 PM on June 22, 2016


What a weird and convoluted article. And while the subject matter is pretty sensation (i.e., the tabloids ought to be eating it up), only the Mainichi is reporting on it. The Chunichi ran a 300-word digest of the story online, but that's about it.
posted by My Dad at 3:48 PM on June 22, 2016 [1 favorite]


China's new president, Xi Jinping, has been cracking down on corruption at the highest levels...
...well, almost highest, since he's not stopping himself from doing anything.
posted by oneswellfoop at 3:49 PM on June 22, 2016 [2 favorites]


My favorite ingenious plan to convert RMB to USD is the lose a lawsuit to yourself strategy.

But this isn't just about corruption. I have friends who conscripted every one of their adult relatives to help transfer the proceeds of the sale of their Beijing apartment in $50k chunks when they were preparing to move to the US a few years ago. Now, even exchanges of a few thousand USD are being denied.
posted by bradf at 4:54 PM on June 22, 2016 [1 favorite]


China's new president, Xi Jinping

About to read the article, but Xi is 3 years in, and became General Secretary in 2012. He was Hu's veep before that. "New" seem like an odd characterization.
posted by aspersioncast at 9:14 PM on June 22, 2016


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