An Overview of the New Shenzhen QFLP Program

On Jan. 29, 2021, the Shenzhen Municipal Administration for Financial Regulation (the SMAFR) issued the Shenzhen City, Measures on the Pilot Foreign-Invested Equity Investment Enterprise Project (the New Measures) (深圳市外商投资股权投资企业试点办法), which represents the third iteration of the government's pilot scheme for qualified foreign-invested equity investment pilot enterprises (or more commonly known as qualified foreign limited partners, or "QFLPs") to have been issued over the past decade. The first version of the QFLP measures was promulgated in 2012, and entitled the Shenzhen City, Tentative Measures for the Launch of the Pilot Project Work for Foreign-Invested Equity Investment Enterprises (the 2012 QFLP Measures) (关于本市开展外商投资股权投资企业试点工作的暂行办法). These measures were followed in 2017 by a revised version entitled the Shenzhen City, Measures on the Pilot Foreign-Invested Equity Investment Enterprise Project (the 2017 QFLP Measures) (深圳市外商投资股权投资企业试点办法).

Compared with the 2017 QFLP Measures, the New Measures have brought about some important changes: they have relaxed the requirements which have to be met in order to achieve QFLP status, expanded the scope of QFLP businesses, and strengthened and streamlined the ongoing management of QFLP business and entities, all to a significant degree. The most significant revisions made in 2021 are summarized below.

1 .   Direct Investment by QFLP Fund Managers in Target Company