HONG KONG: China's securities regulator is setting up a team to review plans by Chinese companies for initial public offerings abroad, sources with knowledge of the matter said, including those using a corporate structure which Beijing says has led to abuse.
The offshore company enters into a series of contracts with the owner of the local Chinese company, which operates the business in China, to obtain 100per cent economic interest in that business, Jefferies analysts wrote on Thursday. "This structure enables foreign investors to invest and hold shares in a listed company that is incorporated overseas and carries on and owns businesses that would otherwise be subject to foreign ownership restrictions in the relevant place of operation," said Ivy Wong, Baker McKenzie's Asia Pacific capital markets practice chair.There has been no effective regulatory framework in China for listings of VIE-structured companies.
Singapore Latest News, Singapore Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.