Sina Corporation (Sina), up and running for 15 years, has been a pioneer among Chinese Internet companies, almost going through all the changes of China’s Internet industry. The interviewee of this Article has not only witnessed profound changes of China’s Internet companies, but also felt emergence of Internet laws from nil, little to continuous improvement.
Gu Haiyan, the current director of legal department of Sina, has been working with the department for 13 years since July 2001. She has helped expand the two-member department to a 50-strong legal team for both the headquarters and localized sites.
Meanwhile, Sina has emerged from a small business with 500-600 staff to a giant Internet group with two listed companies (the main Web portal and micro-blogging), over 6,000 staff and 600 million registered users. The organizational structure of the legal department has developed from the initial single two-person team into a systematically managed department covering six business segments, namely, investment, litigation, IP, government relations, contracts and micro-blogging. The segments value mutual collaboration and division of labor in management of legal work in areas of mergers and acquisitions, investment, listing, litigation, disputes, IP (trademarks, domain names, patents, software), contract review, local sites management, business license and qualifications, Internet banking, government relations and policy research.
With the constant improvement of the organizational structure of the legal department, the workload for each legal segment has also grown significantly. The number of contracts drafted and endorsed by the legal department has jumped from the initial 3,000-4,000 per year to the current 50,000-60,000 per year; the number of trademarks and software has increased from dozens to over 2,000 at present.
In the meanwhile, the cumulative number of lawsuits has amounted to over 1,000, more than 90% of which had favorable rulings to Sina. More than 200 foreign-invested projects have been handled with the amount of investment reaching several billion yuan. The legal management and services have covered dozens of onshore and offshore corporate and investment entities from the initial several.
As various types of regulatory measures for the Internet industry come out, Gu has led the legal department and worked closely with senior executives to constantly enhance the importance of business compliance. They have successively helped the company obtain up to 20 Internet operating licenses including the Internet Information Service License, the Internet Culture Operation License, the Value-added Telecommunications Service License, the Internet Publication License, the Online Mapping Service License, the Internet Performance Brokerage License, the Surgical, Medical and Educational Information Service License, Third-party Payment License and Fund Sales License. The obtainment of the series of licenses not only demonstrates the diversity and leadership of Sina in the Internet industry, but also confirms the greatest achievements made by the legal department and other grassroots departments.
It is worth noting that in 2014 Sina won a cross-border IP lawsuit against Tencent and was granted the right to register and operate top domain names “weibo” and its Chinese equivalent, the two out of three winning cases among more than 1,000 lawsuits over top domain names across the globe. During the proceedings, Gu led the legal department, got full support from other departments and finally won the cross-border battle. The victory greatly boosted the morale of Sina employees, and made more specific Gu’s ideas of development of the legal department and her orientation of future efforts.
Starting from “The World in Your Eyes”
Sina was still a fledgling Internet start-up with an unknown prospect 13 years ago. While at that time, Gu had practiced as a lawyer for 4 years after graduation as a master of international law, pretty expert at contracts, debts, IP, infringement litigation and arbitration. Somewhat a well recognized lawyer, she might have certainly been a lawyer in China if she had continued with her practice.
Life is full of coincidences. At that time she was eager to make a change and try something new, so she accepted advice from her mentor and felt an instant attraction towards the Internet. She believed that the sunrise Internet industry might be the fertile soil to cultivate her ideas. “Although at that time China’s Internet industry was in its primitive phase, I had a great interest and was fully confident of its future. I was also willing to do my bit to promote its orderly development.
My knowledge of international law has also been a helping hand during years of legal practice.” Apart from her strong interest in the Internet, she chose to join Sina partly because its slogan “The world in your eyes” projected a positive and passionate working environment, which filled her with longing for its future development and unlimited expectations for the legal position.
Currently Sina’s legal team has grown over 20-fold since its founding, the workload has also increased dozens of times. Speaking of its start-up period, Gu made more mention on pressure and difficulty.
At that time, Sina was in its initial phase of development, so was the whole Internet industry prior to its rapid development later. Both the work equipment and environment at that time could not match that of nowadays, and Internet laws and regulations were far from complete.
The work experience related to Sina’s business gradually accumulated through continuous groping. In particular, disputes in the Internet industry were quite new for all China as well as the legal department, and there were few references available.
In this regard, Gu expanded and improved the organizational structure of the department, and took the lead in further learning and fostering innovation capabilities. It is on the basis of quite a number of tiny cases of negotiations and handling that Gu and her colleagues have gradually accumulated a set of mature workflow and work experience. Today, the Nasdaq-listed Internet giant is sailing smoothly towards the next goals for the new century under the escort of the legal department.
Commenting on her feelings over China’s Internet industry, Gu said honestly that “After 13 years as inhouse counsel for Sina, my deepest feelings over China’s Internet industry are establishment and improvement of Internet laws and regulations which went from “utter blank” to “full blossom.” China’s Internet industry started up late but grew rapidly.
Internet companies could not invoke any provisions at the very beginning.
Currently Chinese Internet laws and regulations have been put in place, thanks to endless emergence of varied Internet-related issues, to regulate Internet companies’ development models. Meanwhile, a fair competition mechanism has been up and running, creating a harmonious and orderly environment for development of the Internet industry. In addition, we can see from the handling of complaints on Weibo that the general public has gradually enhanced their legal awareness in their fight for legitimate rights and interests. Although there are instances of infringement and unfair competition, we are delighted to be eventually able to find legal bases to solve such problems.”
Rewarding experience
Gu has mixed feelings when it comes to the achievements she has made. “This experience benefits me a lot, so that I have a chance to do my bit to improve laws and regulations for Chinese Internet industry. I am very much pleased to witness the development and growth of Sina’s legal team, which means that our work has been well recognized, and we also actively welcome more talents to join. We have rules to follow in managing the ever growing legal team. Namely, we have a management system for legal staff and we have common team philosophies and objectives. In addition, the legal department has different positions and roles, and they communicate and coordinate through mutual trust, exchanges and sharing of information.” Years of practicing experience as a lawyer has helped Gu a lot in the legal work ever since the startup phase of the legal team. “The experience has laid the foundation for my theoretical knowledge, but also helped accumulate practical legal experience. The strenuous and professional work contents of a lawyer have strengthened my abilities to advise clients on legal matters in a prompt, timely, rigorous and effective fashion. The ensuing habits and abilities are greatly beneficial to my work in Sina, making me composed enough to handle varied disputes.
Participation of lawyers is essential for a successful enterprise, which has been a consensus among modern businesses. Lawyers’ participation as counsel in the management of an enterprise is conducive not only to full use of their abilities, but also to healthy operations of the enterprise, which will have a win-win effect during the lawyer’s transformation into in-house counsel.”
Looking to the future
With the gradual establishment and improvement of China’s legal system, “in-house counsel,” which focuses on legal risks control and provides professional legal services for the development and operations of enterprises, will surely evolve into an essential core department for the enterprise’s operations. Moreover, as the era of economic globalization approaches, more and more foreign-funded companies and multinationals will gather, demanding more legal talents in the enterprise’s operations and management. The marriage of “law” and “business” is sure to be the theme of this era. Therefore, as for large enterprises, establishment and promotion of legal department and legal work has become an important criterion in deciding whether the enterprise is capable of adapting to the times. Continuous recruitment of elite legal talents in their management and operations has been a winning weapon for Internet enterprises in the 21st century. In this regard, the legal department of Sina has never ceased its steps forward. It is estimated that its legal department will substantially increase in size for the next couple of years.
As regards the prospects for the future, Gu said, “The Internet industry is closely related to technologies, and IP rights are more vulnerable to infringement than other industries. Therefore, more efforts are needed for IP protection. Different segments of our legal department have joined forces in the risk control of IP rights. We have provided a full range of professional legal services to minimize IP risks in areas of review of contracts signed by R&D departments, IP evaluation and archiving, and IP disputes handling. This is my future orientation on the basis of the legal department as in-house counsel for Sina. As more Chinese Internet companies continue to get listed overseas, China’s Internet will soon be able to influence the world. Sina’s ‘You are the one’ will be not only a publicity slogan, but also a reality.”
(Translated by Wang Hongjun)
