PRC Outward Direct Investment: Liberalization Momentum Consolidated

July 02, 2006 | BY

clpstaff &clp articles

The Circular drops the previous acquisition deposit requirement but adds a repatriation requirement where approval procedures are not completed within six months.

PRC investors' ability to compete in the increasingly fast-moving market for cross-border M&A, and other forms of foreign direct investment, will be increased by simplification of various procedures and by expanded freedom to remit funds for early stage expenses.

Neal A. Stender, Orrick, Herrington & Sutcliffe, Hong Kong;
Xiaowei (Sherry) Yin, Nicholas Sheets and Lei Cui,
Coudert Brothers LLP, Beijing and Shanghai

Liberalization of restrictions on the purchase and remittance of capital account foreign exchange, for entities in the People's Republic of China (PRC) to make outward foreign direct investments, has been further consolidated by a series of circulars of the State Administration of Foreign Exchange (SAFE).1

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