China’s SAMR Tightens Its Grip on M&A Notification, May Close VIE Gap
Variable Interest Entity (VIE) is a grey area in China. In the early days, VIE was a convenient alternative for Chinese internet companies to raise money overseas, due to certain obstacles in the domestic market and for foreign companies to invest in China without going through a merger review process. However this may change after the Mingcha Zhegang/Huansheng Information decision. While companies may still use a VIE for investment purposes, these operations may have to be notified in China.
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