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By King & Wood Mallesons

King & Wood Mallesons has updated its guide to doing business in Australia.

Australia welcomes and encourages foreign investment and has a favourable investment environment.  Investments that create exports, replace imports, introduce new technology or create employment are

particularly welcome.

Australia offers significant benefits for foreign investors, including:

  • a resilient and diverse economy with low inflation;
  • a transparent and liberal process for approval of foreign investment;
  • low barriers to trade and investment, with business-oriented corporate regulation;
  • a competitive company tax rate; and
    Continue Reading A guide to doing business in Australia

By Zhang Yi, Alan Du and Hu Xia  King & Wood Mallesons’ Corporate Group Shanghai Office

Recently, it was reported by various media sources that the National Development Reform Commission (NDRC) had issued certain policies requiring an RMB fund (the ‘FIE GP Fund’) with a foreign invested enterprise (the ‘FIE’) acting as the general partner (the ‘FIE GP’) and domestic investors (exclusive of FIEs established in China) acting as limited partners to be regarded as a foreign investor. Being defined as a foreign investor means that the portfolio investments of such a FIE GP Fund shall be subject to foreign investment approvals, which are read by the public as referring to the approvals from the Ministry of Commerce or its local counterpart (MOFCOM).

International private equity firms often structure their RMB funds in the form of FIE GP Funds, as a result this news caused great concern among them because their RMB funds will be defined as offshore funds in regard to making portfolio investments and as a result there will probably be little chance of raising new RMB funds in the form of FIE GP Funds.
Continue Reading NDRC reply on RMB Fund with FIE GP

By  Zeng Xianwu Bai Lihui King & Wood’s Foreign Direct Investment (FDI) Group

To achieve the initial public offering (“IPO“), there are two options for Chinese companies, onshore listing (also known as A-share listing) and offshore listing (also known as red-chip listing).  Since the conditions and qualifications for A-share listing are usually a little higher and the procedure is more time-consuming than for the offshore listing, Chinese companies which cannot meet the A-share listing’s requirements or which need to complete IPO rapidly, usually would prefer the red-chip listing.  For the red-chip listing, there are two commonly-used structures for Chinese companies: the straight-forward offshore listing structure and the VIE structure.  In addition, for the purpose of attracting foreign investors and for circumventing restrictions on foreign direct investment, during the Pre-IPO restructuring, the VIE structure is also widely used by Chinese companies and foreign companies alike.

In 2011, after a series of public events, the variable interest entity (“VIE“) structure re-attracted a lot of attention and concerns from the PRC authorities, entrepreneurs, investors and other market participants.  This essay will describe the circumstances in which the VIE structure was created, how it has been used and the changes in the regulatory environment which might affect the feasibility of utilizing the VIE structure.Continue Reading Variable Interest Entity Structure in China

作者：徐萍 金杜律师事务所外商投资组

长期以来，可变利益实体结构（即Variable Interest Entity，“VIE”结构）一直是外国投资者进入中国外商投资限制领域的常用模式。与此同时，VIE结构一直以来也是中国境内企业在境外资本市场实现上市的常用做法。

第一个通过VIE结构上市的著名案例便是新浪，其于2000在美国纳斯达克成功上市。实际上，VIE结构的另一种常用的说法就是“新浪模式”。新浪使用VIE结构成功绕开了中国电信增值产业对于外商投资的限制。从那以后，无论是外国投资者还是国内投资者在中国很多限制或禁止外商投资的领域开始复制使用VIE结构。

VIE结构实质上是指一种安排，根据该安排，在中国境内的一家全资或合资外商投资企业（“控股公司”）取得另一家实际运营公司（“运营公司”）的控制权，而该运营公司则持有必要的许可以在限制或禁止外商投资的领域内开展业务。由于这些产业被中国政府规定为限制或禁止外商投资的产业，所以外国投资无法直接向该运营公司进行投资。相应的，外国投资者会在控股公司和运营公司之间采取多种合同安排，以便使该控股公司获得对运营公司的运作和管理的实际控制权。该运营公司的利润也将流回控股公司，并其业绩将最终纳入控股公司。
 Continue Reading 在中国通过VIE结构进行外商投资将遇到挑战

金杜律师事务所外商直接投资组

继上海、北京、重庆出台外商投资股权投资企业试点文件后，天津的QFLP(合格境外有限合伙人)试点工作也已展开。2011年11月15日，天津市发展和改革委员会、天津市人民政府金融服务办公室、天津市商务委员会、天津市工商行政管理局联合发布《关于本市开展外商投资股权投资企业及其管理机构试点工作的暂行办法》("《办法》")及其实施细则。 《办法》对由外商投资的股权投资基金和股权投资基金管理企业的设立、资金募集和投资、风险控制、信息披露、备案管理等方面进行详细规范，同时鼓励该试点在天津滨海新区先行先试。Continue Reading 天津启动QFLP试点 率先给予外资PE国民待遇

By King & Wood’s Foreign Investment Group

On October 12, 2011, the Ministry of Commerce (MOFCOM) promulgated the Circular on Issues Relating to RMB Cross Border Direct Investment dated (the "Circular"). The Circular provides that outbound investors (including investors of Hong Kong, Macao and Taiwan) can make direct investment with RMB funds they obtained legally outbound (the "Offshore RMB").Continue Reading MOFCOM Releases Circular on Cross-border RMB Direct Investment

作者：金杜律师事务所外商投资部

2011 年10 月12 日，商务部正式颁布了《商务部关于跨境人民币直接投资有关问题通知》（ “《通知》”）。《通知》规定，境外投资者（含港澳台投资者）可以合法获得的境外人民币依法开展直接投资活动。Continue Reading 商务部发布《商务部关于跨境人民币直接投资有关问题的通知》

By Xu Ping  King & Wood’s Foreign Direct Investment Group

The variable interest entity ("VIE") has long been a popular structure for foreign parties to invest in sectors which are restricted by China’s industrial policy to foreign investment. In addition the VIE structure has also been used as a means by which Chinese domestic entities could list offshore on international capital markets.

The first well known VIE structure was that of Sina.com in its 2000 listing on NASDAQ. Indeed the VIE structure is also commonly known as a "Sina Structure". Sina used the VIE as a workaround structure to avoid restrictions on foreign direct investment (FDI) in the value-added telecom services sector. Since then, both foreign and Chinese investors alike have replicated the VIE structure in many other sectors of China’s economy where FDI is either restricted or prohibited to foreign investors.Continue Reading Variable Interest Entity (VIE) Structure for Foreign Investment in the PRC May Face Challenge

金杜律师事务所融资组

自2009年7月跨境贸易人民币结算试点工作启动以来，相关业务的容量、复杂性及银行业务经历了飞速的发展。在2年的时间内，试点范围在20多个省(区、市)得以实施，中国人民银行计划在今年内将试点范围扩大至全国。为满足企业和银行对政策透明度的强烈需求，外汇管理局、商务部等监管当局已经颁布了一系列的规则和指引以促进人民币跨境业务。2011年6月8日，中国人民银行颁布了《中国人民银行关于明确跨境人民币业务相关问题的通知》(银发[2011]145号)(简称“通知”)。该《通知》从积极的角度阐明了与跨境人民币业务相关的若干重大问题。迄今为止，该《通知》被市场称为“实现人民币国际化的重大进步”。 Continue Reading 中国人民银行新规则助推人民币跨境业务

By King & Wood’s Banking Group

Since the launch of the pilot program of RMB settlement in cross-border trade transactions in July 2009, the volume and complexity of the said transactions and the ancillary banking businesses have been rapidly increasing. During the past two years, the pilot program was carried out in 20 provincial regions. PBOC plans to expand the pilot program to the whole country within this year. In order to satisfy business and banking industry’s strong needs for policy transparency, regulatory authorities such as SAFE and MOFCOM have issued various rules and guidelines aiming to streamline cross-border flows of RMB. On June 8, 2011, PBOC published a most recent circular (1)("Circular") which clarifies several major issues relating to cross-border RMB transactions. Industry feedback regarding the Circular has been positive and the Circular has been interpreted as "a significant step towards the internationalization of RMB" by the market.Continue Reading PBOC New Rules to Boost RMB Cross-border Transactions