Deal Transaction Guidance - China Fortune Investment Group
Deal Transaction Guidance
Due to the complexity of Chinese policies related to foreign investments, the legal transaction process of an merger & acquisition project can be complicated and bureaucratic. Our deal transaction consultants advise on asset/share transfer agreement preparation, facilitation of negotiation, government approval legal registrations.
The asset/share transfer agreement must take into consideration not only the M&A parties; it has to be also approved by Chinese authorities as well. The agreement in turn must cover certain articles required by the government. Therefore, the negotiation related to the agreement could be considered “three party talks”, especially when involving a SOEs (State Owned Enterprises). Major approval authorities include MOFCOM (Ministry of Commerce or its local office), State Owned Assets Supervision Administration or its local office and specific industry supervision authorities for certain industries.
Once the asset/share transfer agreement is approved, other application documents, such as articles of association, the new business license can be issued. At that point, other business registration, such as tax registration, customs registration, etc can be submitted accordingly. In situations where a transaction will result in the formation of either a JV (Joint Venture) or WFOE (Wholly Foreign Owned Enterprise), the new enterprise may qualify for some incentive policies.