by Wang Ling and Zhou Jie  King and Wood Mallesons’ Finance Group

2012 has witnessed another year of growing demand and strong deal flows in the Chinese aviation market. By year end, more than 350 new aircraft will have been delivered for operation in China including commercial airplanes and business jets. Active participation of Chinese banks and leasing companies (through both onshore and offshore entities) along with innovative transaction structures developed for the Chinese market by market participants and their counsels have contributed to the robust growth.

US Export-Import Bank Guaranteed Structure

For the first time in Chinese aviation finance history, a Chinese airline is able to leverage over the credit support of the Export-Import Bank of the United States (“US Ex-Im Bank”) without a guarantee from a Chinese bank or a sovereign undertaking from the Chinese government.
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By: Gao Chunkai, He Yunfan and Li Lingxiao of King and Wood’s Foreign Direct Investment Group

I. Background

On May 20, 2011, the State Administration of Foreign Exchange ("SAFE") issued the Circular of the SAFE on Operating Rules Concerning Financing and Round-Trip Investment Undertaken by Domestic Residents through Overseas Special-Purpose Vehicles (1)( "Circular 19" or "New Operating Rules"), which took effect on July 1, 2011. This Circular provides new operating rules for the foreign exchange registration with the SAFE of round-trip investments made through special-purpose vehicles ("SPV") and non-SPVs.


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作者:高醇恺、李凌霄和贺云帆 金杜律师事务所外商直接投资
一、背景介绍

国家外汇管理局(“外管局”)于2011年5月20日颁布了《境内居民通过境外特殊目的公司融资及返程投资外汇管理操作规程》(1)(“19号文”或“新操作规程”),为特殊目的公司、非特殊目的公司返程投资相关的外汇登记提供了新的操作依据。

外管局曾于2005年10月21日颁布了《关于境内居民通过境外特殊目的公司融资及返程投资外汇管理有关问题的通知》(2)(“75号文”),之后外管局综合司先后于2005年、2007年和2009年颁布了《国家外汇管理局综合司关于下发<关于完善外债管理有关问题的通知>及<关于境内居民通过境外特殊目的公司融资及返程投资外汇管理有关问题的通知>操作规程的通知》(3)(“124号文”)、《国家外汇管理局综合司关于印发<国家外汇管理局关于境内居民通过境外特殊目的公司融资及返程投资外汇管理有关问题的通知>操作规程的通知》(4)(“106号文”)及《国家外汇管理局综合司关于印发<资本项目外汇管理业务操作规程(2009年版)>的通知》(5)(“77号文”,与124号文和106号文统称“旧操作规程”)。目前就境内居民通过境外特殊目的公司融资及返程投资相关的外汇事宜主要是适用77号文。


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By Tony Dong and Alice Zhang, King & Wood’s Tax Department

It is common for multinational companies to deploy offshore holding structures or set up special purpose vehicles ("SPVs") in tax havens to make investments, enter into cross border transactions or to list their IPOs. There are various reasons for companies to utilize offshore SPVs, and tax optimization is clearly one of the top considerations. For example, a company may take advantage of preferential tax treaty provisions or align profits to a low-tax jurisdiction or tax haven. However, in recent years, governments around the world have been tightening their tax administration of cross-border tax avoidance arrangements with TPG’s recent tax dispute in Australia is the latest example. The Chinese government has been actively involved in the game, and the State Administration of Taxation ("SAT") has issued a series of regulations in 2009 to strengthen tax scrutiny on non-residents.


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