The Ministry of Commerce ("MOFCOM") issued a Circular on March 6, 2009, aiming at simplifying and facilitating approval procedures for foreign-invested holding companies, by delegating approval authority for the establishment of these entities to MOFCOM's counterparts at provincial levels, except for foreign-invested holding companies with a registered capital of more than USD100 million, over which MOFCOM retains establishment approval authority. According to the Circular, commercial authorities at the provincial level and vice-provincial level have now been delegated the authority and power to approve the establishment of foreign-invested holding companies with a registered capital of no more than USD100 million. Commercial authorities at the vice-provincial level refer to those in the cities of Haerbin, Changchun, Shenyang, Jinan, Nanjing, Hangzhou, Guangzhou, Wuhan, Chengdu and Xi'an.
Additionally, any subsequent changes to foreign-invested holding companies established upon MOFCOM's approval will also be examined and approved by the aforementioned competent commercial authorities, except for recapitalizations of more than USD100 million and changes to an entity's shareholders, which will still be examined and approved by MOFCOM. The Circular reiterates that foreign investment in holding companies must comply with the Provisions on Foreign Investment in Holding Companies and its supplementary provisions. Investment by holding companies is also disallowed in areas in which foreign investment is prohibited or restricted.
Copyright ©2009 by Kaye Scholer LLP. All Rights Reserved. This publication is intended as a general guide only. It does not contain a general legal analysis or constitute an opinion of Kaye Scholer LLP or any member of the firm on the legal issues described. It is recommended that readers not rely on this general guide but that professional advice be sought in connection with individual matters. References herein to "Kaye Scholer LLP & Affiliates," "Kaye Scholer," "Kaye Scholer LLP," "the firm" and terms of similar import refer to Kaye Scholer LLP and its affiliates operating in various jurisdictions.
Also of Interest
- M&A and Corporate Governance Newsletter | Spring 2016 March 2016 • Reports / Newsletters
- Q&A with Alice Young: Diversity Experiences and Achieving Success in the Legal Profession April 6, 2015 • Media Mentions
- Kaye Scholer’s Shanghai Corporate Team Recommended in The Legal 500 Asia Pacific 2015 2014年11月5日 • Recognitions
- Kaye Scholer’s Global Capabilities Recognized in IFLR1000 2015 October 27, 2014 • Recognitions
- M&A and Corporate Governance Newsletter Summer 2014 • Reports / Newsletters
- How Chinese Companies Can Successfully Invest in the United States June 30, 2014 • Articles
- M&A and Corporate Governance Newsletter Spring 2014 • Reports / Newsletters
- Kaye Scholer Recognized in Six Practice Areas Worldwide in Chambers Global 2014 March 13, 2014 • Recognitions
- Shanghai Corporate Department Recognized by Chambers Asia Pacific 2014 February 18, 2014 • Recognitions