We use cookies to customise content for your subscription and for analytics. If you continue to browse Lexology, we will assume that you are happy to receive all our cookies. For further information please read our Cookie Policy.
On May 20, China's State Administration of Foreign Exchange issued the "Operating Instructions on Foreign Exchange Administration for Domestic Residents Engaging in Financing and Round-tripping Investment via Overseas Special Purpose Vehicles" (Circular 19), which came into effect on July 1
Two recent and noteworthy events in the US and China cause one to ponder what the future holds for the variable interest entity (VIE), an ingenious creation which, for the past decade, has been widely used to attract eager foreign capital, because it seems to have overcome certain People's Republic of China (PRC) regulatory hurdles facing foreign investors while cleverly using US and international accounting standards that would inject financial life in to offshore companies even though such offshore companies do not own an equity stake in the Chinese operations
