We have vast experience in providing comprehensive legal services to foreign investors with respect to their various direct investments in China. Our practice areas are as follows:
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Carrying out research in the legal field in China and industrial policy, |
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answering inquiries, analyzing investment information and commenting |
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on foreign investor investment plans. |
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Designing investment plans; providing professional advice on the legal |
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framework and corporate governance structure. |
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Carrying out due diligence reviews for M&A projects. |
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Participating in commercial negotiations and preparing legal documents. |
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Coordinating the relationship between domestic and foreign investors, competent authorities and related parties. Assisting in research and commenting on legal matters prior to investment relating to such issues as land, real estate, tax, foreign exchange, technology transfer, trademark, business name, etc. |
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Providing legal assistance in approval procedures and registration with the Administration for Industry and Commerce. |
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Providing consultation and assistance in the registration or re-registration with various authorities, e.g. foreign exchange, tax, statistics, etc. |
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Assisting foreign invested enterprises and other entities with any legal problems arising from their day to day operation. |
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Providing updated general legal information relating to foreign investment; gathering information on newly promulgated laws and regulations in connection with certain industries where needed. |
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Providing consultation and assistance in liquidation and bankruptcy matters relating to foreign invested enterprises. |
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Foreign direct investment is one of the traditional core areas in foreign-related legal practices. With the boom in the Chinese economy and its opening up to the outside world, there has been an increasing demand on legal services for foreign direct investment in China. In recent years, M&A has become another major means of access for foreign investors into the Chinese market. Our partners and lawyers have been involved in the business of foreign direct investment for many years and maintain a good relationship with certain renowned multinational companies. Our prudent and down-to-earth way of working earned for us client confidence, which allowed our foreign direct investment practice to keep pace with advanced international standards.
Closely follow foreign investment policies and grasp investment opportunities
The opening-up process quickly built up speed following China's accession to the WTO. As a result many large industries gradually began to open up to foreign investors. Now, foreign investors can get more involved in industries such as retail, franchise, advertising, leasing, engineering, municipal planning, transportation, insurance, financing and foreign exchange, where previously only indirect investment was allowed. Nevertheless, despite the open policy, a perfect system of investment application, administration and issue of permits has yet to be completely established. Therefore currently, although investment is allowed by law, the approval procedure can be a long and drawn out process once an application has been submitted.
When providing legal services in an area recently opened up to foreign investors, we emphasize maintaining good communication channels with the authorities, assessing potential problems and risks so as to prepare our plan in advance for foreign investors as well as collating and providing up to date information on any changes to policies and laws. Furthermore, we will quickly advise foreign investors to be careful about an investment if we come across large difficulties and risks which cannot be solved at the outset.
Focus on legal research and risk evaluation analysis on the collection of investment income and the withdrawal mechanism
The basic aim of any foreign investor making an investment in China is to make a profit. Although China continues to improve and broaden its legal system in this area, there still exist limits and obstructions in respect of corporation, exchange, finance and tax affairs in collecting investment income.
We attach great emphasis on analysing the legal risk to investment income payments and assist foreign investors in making a prudent evaluation at the feasibility study stage and then make reasonable arrangements at the investment structure design stage. In certain industries, for example education, we believe that careful research is particularly necessary. For foreign investors, especially venture capital investors, the establishment of a favourable withdrawal mechanism (exit strategy) is of key importance in order to realize investment income. We can evaluate and analyse different forms of possible investment withdrawal mechanisms, such as the sale of equity interests or the entire sale of the project, in order to provide the best solution.
Objective and active due diligence investigation in M & A
Legal due diligence is necessary in all M&A projects. We have gained enormous practical experience in this field by completing numerous investigations in various industries such as pharmaceuticals, the chemical industry, electric power, food processing, manufacturing, high/new technology, software, service industries etc., involving enterprises with diverse patterns of ownership, large-and-medium-sized state-owned enterprises, collective enterprises and privately-owned enterprises. Having gone through 20 years of constant economic change and development, most domestic-invested enterprises in China suffer from historical problems. For example, in many state-owned enterprises, problems related to collective shareholding, property ownership, reform and trade unions remain largely unsolved; as for private enterprises, problems such as chaotic internal systems, incomplete registrations with the Administration for Industry and Commerce, insufficient income capital, and even operations in breach of laws and regulations exist. All these problems can create risks and even obstacles, to the success of an M&A project conducted by foreign investors.
Notwithstanding all this, our due diligence investigation not only aims at completely exposing all these risks, although we certainly know that revealing risks and maintaining a careful attitude maintain our lawyers' security. One principle we always keep in mind is that a successful M&A is the ultimate goal for investors. We provide foreign investors with workable solutions to quickly bring about a successful M&A and eliminate potential "time bombs" during post-M&A operations through active designation, including preparing reasonable contracts and fulfilling all legal procedures prior to the completion of a M&A project.
Multi-dimensional and complex legal consultancy services
We have acted as long-term legal counsels for many large multinational corporations as well as foreign governments' institutions in China over many years. We have gained a great deal of experience in solving legal problems that foreign-invested enterprises and foreign governments' institutions may come across in their daily operation, including joint venture disputes, license and infringement of intellectual property, product liability, franchise, concession, trade, transportation, insurance, financing, right of enterprise's reputation, corporate governance, labour and trade union problems, social security, and tax affairs etc. On the one hand, we perform on time legal research relating to practical problems arising from an enterprises' daily business so as to give advice and offer possible solutions regarding Chinese laws to these enterprises; on the other hand, we conduct specific research on the issues enterprises are concerned about, in order to provide them with legal and policy information with respect to their sustainable development.
Real estate legal service relevant to FDI
As part of the legal services we provide relating to foreign direct investment, we also offer foreign companies legal services on real estate issues, conducting intensive legal research especially relating to those issues arising from the domestic business activities of foreign retail and infrastructure industries. We provide long-term legal services in connection with real estate issues such as:
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