New Foreign Investment rules in China
…every resident of China must now have approval by SAFE for their business plans (including such information as who owns what) for holding companies overseas; disclose all of the nefarious and clever deal structures created by their attorneys and repatriate every penny raised in the offerings of those shares overseas back into China. Did I mention that the regulation is retroactive?
Most foreign investment in China is through Wholly Owned Foreign Entities, or WOFEs (pronounced “woofie”), which are typically based in the Caymans, Bermuda, or other banking center, and which hold the bulk of the company assets. The new regulations appear to require permission from the State Administration for Foreign Exchange (SAFE) before starting a new operation.
via SiliconBeat and TechDirt
Tags: china, vc, finance
