The People’s Republic of China (PRC) may still have a communist government, but it has embraced capitalism with enthusiasm and is no longer the insular state it once was. In 2008 it hosted a spectacular Olympics in Beijing, when it pushed the boat out in a bid to be viewed as a modern, vibrant nation with a thriving economy and real influence in the world. Ironically it took a global economic crisis for many people to appreciate just how much China now influences the world stage and just how strong its influence is likely to be in the coming years.

Previously known as Peking, the northern city of Beijing has been China’s capital, off and on, since the 11th century. In 1949 it once again took charge, when the Communist Party decided it should supplant Nanjing as the Republic’s primary city. Beijing’s northern location makes it a cold, dry city in a flat, arid region. Once famed for its millions of bicycles, these days everyone wants a car, and given that the city’s population now numbers more than 17 million, it’s easy to see why the place has become so polluted and grey. As if pollution weren’t enough, residents must also cope with regular seasonal dust storms. Beijing is the seat of government and hosts all the other organs of state, so in many respects commerce has taken a back seat.

Shanghai is more vibrant and cosmopolitan than Beijing, which reflects its commercial and maritime roots. Here the top things to visit are The People’s Square and the Bund Promenade at Pudong, from which you can look over the Huangpu River to the dazzling new skyscrapers that have sprouted in the past decade. It is particularly breathtaking at night when the city lights up. One of the key shopping districts is the Nanjing Road, and for a taste of old Shanghai head to the French Concession. Public transport is good as the extensive underground network is cheap and relatively easy to use, not least because signage is written in English as well as characters. At weekends you can take a train to visit other cities, such as historic Suzhou and Hangzhou.

Work: The Chinese economy is one of the fastest-growing in the world. In turn, the country’s demand for raw materials and energy to fuel this growth is huge. This hunger for resources is driving a significant amount of M&A and investment activity, both for companies within China and for Chinese companies abroad in search of resources. These trends, along with parallel regulatory developments, are prompting the PRC to open up for both domestic and international businesses. A relaxation of requirements on foreign investment has whet the appetite of the international community, and even the regulators’ push to persuade domestic companies to list on the Shanghai or Shenzhen stock exchanges instead of overseas has not seriously dampened Chinese firms’ desire to list abroad. Correspondingly, the legal services market in mainland China has grown rapidly to cater to the needs of both expanding Chinese businesses and the international clients that are flocking from all over the world. This is evident in the increasing sophistication of domestic law firms and in the sheer number of international firms setting up shop in Beijing and Shanghai.

M&A, IPO and general investment activity in China remains high. Much M&A and investment is driven by the need for natural resources, such as copper and steel, and energy sources like oil and gas. These needs are large and immediate, which explains Chinese companies’ tendency to buy targets outright rather than pursue building and project financings in this area. As a consequence, the booming infrastructure market tends to be more focused on transport and water projects, which must keep pace with the country’s growing population if China is to maintain such high levels of economic growth. The willingness of domestic banks to lend large sums of money underlies much of this activity, and generally helps deals close relatively quickly and without the need for complex project finance structures. Privatisation is another key trend here, and its introduction to the banking sector has created some of the world’s largest IPOs to date. Finally, the arrival of global private equity funds - many of which are opening offices on the mainland - is another illustration of the high level of interest the world has in investing in China.

The China and Hong Kong legal markets are closely linked, even though there are separate legal systems. Much of the M&A, banking and capital markets work, for example, is conducted across both jurisdictions. However, in China foreign lawyers are prohibited from advising on PRC law and cannot appear in Chinese courts. This does not mean international firms do not have a role to play in China: they are, necessarily, providing different services to clients. Commentators have noted that many PRC firms operate more like a collection of talented individuals rather than a typical firm, and indeed the concept of law firms is a relatively new one in China - the largest PRC firm, King & Wood, was founded as recently as 1993. Despite their relatively short history, Chinese firms are developing in leaps and bounds, particularly with respect to servicing international clients. The recent movement of many Western-trained local lawyers back to PRC firms is an important factor in aiding this development. Finally, some PRC firms are eyeing up allegiances with Hong Kong firms. King & Wood formed a strategic alliance with Arculli Fong & Ng in 2006, which finally culminated in a full merger in 2009 when both PRC and Hong Kong laws allowed it.

The number of foreign law firms in China has grown rapidly since 1992, when the government officially permitted international outfits to establish representative offices in the country. Initially this was on a ‘one firm, one office’ basis, but foreign firms can now apply for a licence to open a second office once their first is well established. While the legal market has relaxed in this respect, foreign firms are still restricted concerning the advice they can provide to clients. They are able to offer limited general information about the Chinese legal environment, but cannot interpret Chinese law. International firms generally co-operate with leading domestic outfits to advise on cross-border matters.

The heart of Beijing’s CBD is its World Trade Center, where the international law firms have their offices. Non-Mandarin speakers will be at a big disadvantage despite the fact that English is being spoken by an increasing number of professionals and business people. It’s much the same story in Shanghai, although this city has always been the more cosmopolitan of the two. In both, the working week is a standard five days, so there’s no need for your weekend to be eroded unless the office is especially busy. International firms are trying to establish themselves in each location, but their licences do not permit them to practise PRC law. Their role is more that of consultants, and of course they can advise on the law in other jurisdictions. Increasingly, intellectual property law is a key and, similarly, clients need advice on anti-dumping and other competition law matters. Corporate and finance deals are becoming ever more abundant.

Rest and play: Beijing is not a beautiful city: in the belief that newer is better many old buildings were torn down; however, there is now a realisation that tourists like traditional architecture, so some of the remaining ‘hutongs’ are being restored to former glory. Topping the list of things to see in Beijing are the Forbidden City (get a preview by watching the movie The Last Emperor… not that it shows the Starbucks outlet), the Great Wall, Tiananmen Square and the Summer Palace. For shopping there is Wangfujing, or you can fake your designer wardrobe at Silk Street market. In 2006 Beijing had just four subway lines but four more were constructed before the 2008 Olympics. Another opened in 2009 and if current plans go ahead there will be 19 lines in operation by 2015, which neatly demonstrates the pace of change here.

You may find you use taxis a good deal as the buses are always so busy; be aware that taxi drivers will usually need to see the destination written in Chinese characters and rarely speak English. Trainees also highlight the need to pay attention to “basic things like crossing the road – there's the risk of death” to the unwary Englishman as cars follow the US system that permits turning left on red lights. Eating out and drinking, even in relatively expensive Westernised places, is much more affordable than back home. For fun nights out try Houhai and Sanlitun. For lazy days Beijing has great parks, one of the most notable being Beihai.