Legislation roundup: Foreign-invested enterprises and investing with insurance proceeds

October 26, 2012 | BY

clpstaff &clp articles

The Ministry of Commerce has issued tentative provisions on equity investments for foreign-invested enterprises, while the China Insurance Regulatory Commission has opened up investment in financial products with insurance proceeds

Foreign investment

Ministry of Commerce, Tentative Provisions on Capital Contributions Made in the Form of Equity involving Foreign-invested Enterprises
商务部关于涉及外商投资企业股权出资的暂行规定

When a foreign investor uses its equity interests in a Chinese company to invest in another foreign-invested enterprise (FIE), the total amount of investment in the form of equity and non-monetary property in the FIE may not be more than 70% of the registered capital of the FIE.

Also, the equity of real property enterprises, foreign holding companies, foreign-invested venture capital investment enterprises and foreign-invested private equity enterprises is not allowed to be used for investment in another foreign-invested enterprise.

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