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Editorial

Press releases and law firm thought leadership

This page is dedicated to keeping readers informed of the latest news and thought leadership articles from law firms across the globe.

If your firm wishes to publish press releases or articles, please contact Shehab Khurshid on +44 (0) 207 396 5689 or shehab.khurshid@legalease.co.uk

 

China’s New Draft Foreign Investment Law

March 2019 - Corporate & Commercial. Legal Developments by V&T Law Firm.

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The State Council presents a near-final draft to the National People’s Congress

January 11, 2019

Foreign investment; cross-border transactions

Update - Client Alert SHSE Sci-Tech Innovation Board (2019.3.8)

March 2019 - Corporate & Commercial. Legal Developments by V&T Law Firm.

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 Update — China’s Version of NASDAQ ?

Shanghai Stock Exchange to create Sci-Tech Innovation Board

March 8, 2019

Capital markets; foreign investment

On March 1, 2019, the China Securities Regulatory Commission (CSRC) and Shanghai Stock Exchange (SSE) released the final version of the Sci-Tech Innovation Board Rules (STI Board Rules) that were published in draft form on January 30, 2019.[1] The Chinese authorities rarely finalize draft regulations this quickly. It appears that the Chinese government wishes to enable the SSE’s Sci-Tech Innovation Board (STI Board) to better compete with the Hong Kong Stock Exchange, NASDAQ, and perhaps even the New York Stock Exchange. Other Chinese boards like Shenzhen’s ChiNext board and Beijing’s New Third Board claimed to be like NASDAQ, but investor response has not been as positive as had been hoped, and these earlier Chinese boards are not as deregulated and market-oriented as the STI Board purports to be. From the opening of the SSE stock market after Chinese New Year until the day before the finalized STI Board Rules were released, the Shanghai composite experienced its largest monthly gain since April 2015, and major banks like Credit Suisse predicted that Chinese markets would continue to prosper.[2] This suggests that investors welcome the finalized STI Board Rules. On February 11, 2019, V&T Law Firm (V&T) published an article that analyzed five characteristics of the draft STI Board Rules.[3] This client alert is an update based on the finalized STI Board Rules.

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[1] The terms “PRC” and “China” are used interchangeably in this client alert and neither includes Hong Kong, Macau, or Taiwan.

[2] Eustance Huang, “Credit Suisse on stocks: 'We love China at the moment',” CNBC China Markets, March 1, 2019, https://www.cnbc.com/2019/03/01/credit-suisse-on-stocks-we-love-china-at-the-moment.html.

[3] A V&T client alert regarding the draft version of the STI Board Rules is available at: http://www.vtlaw.cn/ueditor/php /upload/file/20190214/1550109008571307.pdf. This client alert is an update. 

China’s Version of NASDAQ ? Shanghai Stock Exchange to create Sci-Tech Innovation Board

March 2019 - Corporate & Commercial. Legal Developments by V&T Law Firm.

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February 11, 2019

Capital markets; foreign investment

The China Securities Regulatory Commission (CSRC) recently published guidelines for a new Sci-Tech Innovation Board (STI Board) that will be created at the Shanghai Stock Exchange (SSE).  The board will feature innovative scientific and technological enterprises, and some analysts claim that the STI Board might be able to compete with the Hong Kong Stock Exchange, NASDAQ, and perhaps even the New York Stock Exchange (NYSE).  In any event, this is one of the more major reforms that China’s stock markets have seen over the past 30 years. It will be easier to list innovative enterprises on the STI Board, as eligible companies can be listed by filing the required documentation with the SSE; the CSRC will be responsible only for the securities registration. But will the STI Board really be a Chinese version of NASDAQ? This client alert examines some of the new features of the STI Board and some of its more important listing procedures.

The Reach of Shareholder Look-through

November 2017 - Corporate & Commercial. Legal Developments by Han Kun Law Firm.

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Authors: Yaohua HU 丨 Xin DU 丨 Yikai WANG 丨 Yunting YE

The PRC Law on Securities (“Securities Law”) and relevant laws and regulations strictly prohibit the unauthorized issuance of shares to the public (the issuance of shares either to nonspecified persons or to specified persons which results in the issuer having more than 200 shareholders). In practice, the China Securities Regulatory Commission (“CSRC”) is intently focused on whether the number of shareholders exceeds 200 upon applying certain shareholder “look-through” rules. In general, “look-through” means to examine the upstream shareholding structure of companies or the subscription structure of private equity (“PE”) funds or asset management plans to determine the ultimate natural person, listed company or State-owned Assets Supervision and Administration Commission (“SASAC”) investors. The scope of the look-through rules is an important factor that affects the 200 shareholder threshold determination, although this concept continues to be ambiguous. By analyzing the relevant laws, regulations and cases, this article discusses the scope of look-through in determining the number of shareholders in different types of capital market transactions, including IPOs, backdoor listings, asset purchases through share issuances (not constituting a backdoor listing), cash subscriptions for private share placements of A-share listed companies, public issuances of A-share listed companies (share allotments, additional share issuances), NEEQ listings and the private placements of NEEQ listed companies.

Shanghai Circulates Incentive Policy 2.0 for Foreign-Invested R&D Centers

November 2017 - Corporate & Commercial. Legal Developments by Han Kun Law Firm.

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Authors: David TANG, Jun LI, Serina WEI

On October 16, 2017, Shanghai Municipal People’s government circulated the Several Opinions on Further Supporting Foreign-Invested Research and Development Centers to Participate in Shanghai’s Construction of a Science and Technology Innovation Center with Global Influence (Hu Fu Fa [2017] No. 79, hereinafter “Opinions”), which can be regarded as a policy 2.0 to promote the establishment and development of foreign-invested research and development centers (“R&D Centers”) following the issuance in 2012 of the Several Opinions of Shanghai Municipality on Encouraging the Establishment of Foreign-Invested Research and Development Centers by the Shanghai Municipal Commission of Commerce, the Science and Technology Commission of Shanghai Municipality and the Shanghai Municipal Development and Reform Commission.

New Trends in Overseas Investment Administration

November 2017 - Corporate & Commercial. Legal Developments by Han Kun Law Firm.

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Authors: Gloria XU, Claire XIAO

On August 4, 2017, the Guiding Opinions on Further Guiding and Regulating the Direction of Overseas Investment (Guo Ban Fa [2017] No. 74) " (the “Guiding Opinions”) was jointly promulgated, with the approval of the State Council, by the National Development and Reform Commission (“NDRC”), the Ministry of Commerce (“MOFCOM”), the People's Bank of China (“PBOC”) and the Ministry of Foreign Affairs (“MFA”). The Guiding Opinions have drawn wide attention by further categorizing overseas direct investments as “encouraged,” “restricted” or “prohibited” based upon the previous “negative list” for overseas direct investment. In this article, we will summarize the main content of the Guiding Opinions by comparing them to the existing principles governing overseas direct investment in light of recent trends related to the supervision of overseas direct investment.

Brief Comment on the General Provisions of the Civil Law

November 2017 - Corporate & Commercial. Legal Developments by Han Kun Law Firm.

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Author: Han CHEN

As a prelude to the civil code of the People's Republic of China, the General Provisions of the Civil Law of the People's Republic of China (the “General Provisions”) was adopted with votes at the Fifth Session of the 12th National People's Congress on March 15, 2017 and will enter into force on October 1, 2017. This marks an important first step of China on its path to compiling a civil code.

Hong Kong New Board – To Embrace the New Economy

November 2017 - Corporate & Commercial. Legal Developments by Han Kun Law Firm.

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Authors: Han Kun Hong Kong Associate Law Firm Yurong YE, Felix MIAO, Fredric HUANG

Recently, the Stock Exchange of Hong Kong Limited (“SEHK”) has published the New Board Concept Paper for the purpose of seeking market feedback on SEHK’s proposed establishment of a New Board. This newsletter is a brief introduction to the New Board Concept Paper.

Foreign Direct Investment Law

November 2017 - Corporate & Commercial. Legal Developments by Han Kun Law Firm.

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Shanghai further optimizeslocal policies to promote the establishment of regional headquarters of multinational corporations.

David TANG | Jun LI | Serina WEI

Shanghai, as the leader of further opening up and attracting foreign investment in China, has recently promulgated the revised Regulations of Shanghai Municipality on Encouraging Multinational Corporations to Establish Regional Headquarters ("2017 Regulations") on February 14 2017, which further optimizes the investment, economic development and governmental service environments, in order to spur multinational corporations ("MNC") to consider Shanghai as their first choice for establishing regional headquarters.

The hot season of apricots and almonds in China

September 2013 - Corporate & Commercial. Legal Developments by HFG.

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On August, 2013, a consumer filed a complaint for misleading advertising with Dong Xin AIC (Zhejiang province) against Hangzhou-based roasted nut and dry-food producer Yaotaitai.

Novel food, new regualtion

August 2013 - Corporate & Commercial. Legal Developments by HFG.

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China's regulation of so called "Novel food" is changing.

On October 1, 2013, the "Administrative Measures for Safety Review of New Food Materials" (the "New Measures") will come into force, thus repealing the former 2007 regulation.

China Update 2012

May 2012 - Corporate & Commercial. Legal Developments by Wikborg Rein.

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This edition of Update gives you an interesting insight to the business market in China and the story of Wikborg Rein's office in China.

Learning from Huawei's Case: Its Implications for China

January 2012 - Corporate & Commercial. Legal Developments by Guantao Law Firm.

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With Huawei's declaration to accept the recommendation by the Committee on Foreign Investment in the United States (CFIUS) to drop its patent-purchase deal with a U.S. small technology company 3 Leaf Systems, its attempt to acquire U.S.-based high-tech company fails once again. China’s Ministry of Commerce expressed “regrets” over Huawei’s failure in the acquisition, and hoped the United States to take appropriate measures to avoid protectionism and adopt a fair, just and open attitude towards the investment from around the world.

No Break of Lease with Bargain

January 2012 - Corporate & Commercial. Legal Developments by Guantao Law Firm.

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"no break of lease with bargain” has been established as a PRC civil law principle on real property. Based on this principle, tenant shall be entitled to use the leased property within the term of the lease even if landlord alienated the property to others, and the buyer can neither terminate the lease nor evict the tenant merely because he is the new owner of the property. Currently, the expression of “no break of lease with bargain” is not only appeared as a theoretical term but also incorporated into regulations. For instance, Administrative Measures of Shanghai Municipal on Leasing of Residential Property take effect as of October 1, 2011, and the subtitle of Article 19 is exactly expressed as “no break of lease with bargain”.

Measures against bad faith in revised draft of Trademark Law

November 2011 - Corporate & Commercial. Legal Developments by Wanhuida Peksung.

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The term 'bad faith' is not directly defined in either the existing Trademark Law or the revised draft that was published by the Legislative Affairs Office of the State Council on September 1 2011. However, the concept has been adopted in China and has played an important role in both trademark law and practice. In the discussions surrounding the revision of the law, there have been calls to place greater emphasis on the concept of bad faith. This update analyses the measures in the revised draft that seek to address the issue.

Common Legal Risks in Outbound Direct Investment of Chinese Enterprises

From the beginning of 1980s, Chinese enterprises have started searching the way to outbound investment. 

R&D issues that foreign investors may need to consider in joint venture negotiations

February 2011 - Corporate & Commercial. Legal Developments by Guantao Law Firm.

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More international companies are moving their R&D activities to China.Doing so through establishing a wholly foreign-owned enterprise is an easier solution, as it enables the international companies to keep all intellectual property rights (IPR) to themselves, without risking sharing this with a local partner. 

Protect your intellectual property in China!

November 2010 - Corporate & Commercial. Legal Developments by Wikborg Rein.

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Recently, several containers of goods to be exported by a Norwegian company doing business in China were confiscated in a Chinese port by Chinese customs authorities.

Not enough attention paid to significant legal risks in M&A process

November 2010 - Corporate & Commercial. Legal Developments by Guantao Law Firm.

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In the merger and acquisition process, a comprehensive understanding (or lack thereof) about the significant legal risks that are embedded can determine the success or failure of the deal. Lawyers and in-house counsels should pay close attention to the following issues:

 

Not enough attention paid to significant legal risks in M&A process

November 2010 - Corporate & Commercial. Legal Developments by Guantao Law Firm.

More articles by this firm.

In the merger and acquisition process, a comprehensive understanding (or lack thereof) about the significant legal risks that are embedded can determine the success or failure of the deal. Lawyers and in-house counsels should pay close attention to the following issues:

Analysis of legal issues in financial lease companies

September 2010 - Corporate & Commercial. Legal Developments by Guantao Law Firm.

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Finance lease is one of the most important ways used for renewal of equipment and financing by companies. The main governing law in this area is the Measures for Administration of Financial Leasing Companies, which came into effect on 1 March 2007.

FIP Measures present both opportunities and challenges

September 2010 - Corporate & Commercial. Legal Developments by Guantao Law Firm.

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The “Administrative Measures to the Establishment of Partnership in China by Foreign Enterprises and Individuals” (“FIP Measures”) came into effect on March 1, 2010.

Financial Strategy Adopted by Real Estate Companies and REITs

August 2010 - Corporate & Commercial. Legal Developments by Guantao Law Firm.

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Real Estate Investment Trusts”REITs”have become a financial innovation area closely watched by real estate and financial industries since they were confirmed by the State Council in December 2008. REITs have also been recognized and understood by more and more people in China .  After two years’ rigorous study of REITs by the relevant supervision departments, pilot rules and supporting regulations have taken shape and are expected to come into effect in China within this year.

Introduction to the relevant policies regarding foreign investment in China’s real estate market

In accordance with the current policies regulating foreign investment in China’s real estate market, and combined with Decree No.34 issued on March 8 2010 by the PRC Ministry of Land and Resources (Circular on the strengthening and monitoring of land supply for real estate-related issues), foreign investors are advised to pay attention to the following issues when investing in China’s real estate market.

 

CSRC offers guidance on ChiNext sponsorship, reiterating ChiNext market orientation

On 19 March 2010, China Securities Regulatory Commission (CSRC) issued the Guidelines on Further Duly Performing Sponsorship Work in Connection with ChiNext.

Time Management for PRC Anti-Monopoly Filings

Under the PRC’s new Anti-Monopoly law framework,many M&A transactions would have to be reported to the Anti-Monopoly Bureau (“AMB”), which means parties to the transaction need to allow extra time in the deal to complete this procedure.

Rules on Establishing Partnerships By Foreign Enterprises or Individuals

The Administrative Rules on Establishing Partnerships by Foreign Enterprises or Individuals within China ’s Territory comes into effect on 1 March 2010.