China is revising the laws that govern the variable interest entity, a complicated structure used by many companies to bypass foreign investment restrictions. What are the implications?
The upcoming Alibaba IPO has brought to the fore the contentious issue of how Chinese companies bypass foreign investment restrictions using a legal structure called the Variable Interest Entity (VIEs). A company in China is 100% owned by domestic parties, allowing it to obtain all necessary licenses to operate in a particular sector. It signs […]