M&A

From China to Wall Street and back
After this summer’s backlash against Chinese companies listed in the US, many are considering going private to avoid further negative publicity, decreased valuations and the increased risk of litigation

Looking outward: Q&A with State Grid
CLP caught up with State Grid's Chief Legal Officer, Ling Li to discuss her legal team’s function and gain insight on doing outbound transactions

Provisions for the Implementation of the System for Security Review of Acquisition of Domestic Enterprises by Foreign Investors [Full Text Translation]
实施外国投资者并购境内企业安全审查制度的规定
The Provisions are basically a revision of the Tentative Provisions on Matters Relevant to the Implementation of the System for Security Review of Acquisition of Domestic Enterprises by Foreign Investors.

Ministry of Commerce, Provisions for the Implementation of the System for Security Review of Acquisition of Domestic Enterprises by Foreign Investors [Legislation Digest]
商务部实施外国投资者并购境内企业安全审查制度的规定
Mofcom prohibits circumvention of M&A security review by means of offshore transactions

Taking equity in an FIE
Two M&A specialists present their views on issues to consider when making an equity acquisition in a foreign-invested enterprise.

Tentative Provisions on Matters Relevant to the Implementation of the System for Security Review of Acquisition of Domestic Enterprises by Foreign Investors [Full Text Translation]
实施外国投资者并购境内企业安全审查制度有关事项的暂行规定
The Provisions detail the security review application procedure for acquisition of domestic enterprises by foreign investors.

Protection measures
The State Council recently promulgated a new initiative to establish a security review system on domestic M&A activities conducted by foreign parties. This new process officialises an attempt to safeguard key Chinese companies, but will add time and cost burdens to select potential overseas investors

Restructuring first for outbound Chinese M&A
When a PRC industrial company purchased a European chemicals producer, it utilised an advanced acquisition strategy that included a complex debt restructuring. It also had to convince Chinese regulators the strategy was workable

Ministry of Commerce, Tentative Provisions on Matters Relevant to the Implementation of the System for Security Review of Acquisition of Domestic Enterprises by Foreign Investors [Legislation Digest]
商务部实施外国投资者并购境内企业安全审查制度有关事项的暂行规定
Mofcom may terminate M&A transactions that affect national security.

Be familiar with M&A details before security review submission
Required documents will take time to prepare

Ministry of Commerce, Circular on Issues Relevant to the Administration of Foreign Investment [Legislation Digest]
商务部关于外商投资管理工作有关问题的通知
Mofcom lifts the examination and approval requirement for certain foreign investment matters.

Circular on Issues Relevant to the Administration of Foreign Investment [Full Text Translation]
关于外商投资管理工作有关问题的通知
The Circular lifts and streamlines the examination and approval requirements for certain foreign investment matters.

China Securities Regulatory Commission, Opinions on the Application of Securities and Futures Laws No.7: Opinion on the Application of Article 62 of the «Measures for the Administration of the Takeover of Listed Companies» Concerning Listed Companies Facing Serious Financial Difficulties [Legislation Digest]
中国证券监督管理委员会《上市公司收购管理办法》第六十二条有关上市公司严重财务困难的适用意见—证券期货法律适用意见第7号
CSRC gives a definition of a seriously distressed company.

China Securities Regulatory Commission, Opinions on the Application of Securities and Futures Laws No.8: Opinion on the Application of Articles 62 and 63 of the «Measures for the Administration of the Takeover of Listed Companies» Concerning a Coincidence of the Clauses on the Application for an Exemption from Making an Offer [Legislation Digest]
中国证券监督管理委员会《上市公司收购管理办法》第六十二条、 第六十三条有关要约豁免申请的条款发生竞合时的适用意见—证券期货法律适用意见第8号
Acquirers allowed to select their own offer exemption clause in case of a coincidence of clauses.

China Securities Regulatory Commission, Opinions on the Application of Securities and Futures Laws No.9: Opinion on the Application of Article 74 of the «Measures for the Administration of the Takeover of Listed Companies» Concerning the Determination of the Time of Completion of an Acquisition to Increase the Shares Held in a Listed Company Accomplished through Centralised Competitive Trading [Legislation Digest]
中国证券监督管理委员会《上市公司收购管理办法》第七十四条有关通过集中竞价交易方式增持上市公司股份的收购完成时点认定的适用意见—证券期货法律适用意见第9号
Time of completion of an acquisition to increase shareholding clarified.

China Securities Regulatory Commission, Opinions on the Application of Securities and Futures Laws No.11: Opinion on the Application of Article 12 of the «Measures for the Administration of Material Asset Reorganisations by Listed Companies» Concerning the Calculation of Percentages Relating to the Purchase or Sale of the Identical or Related Assets by Listed Companies for a Continuous Period of 12 Months [Legislation Digest]
中国证券监督管理委员会《上市公司重大资产重组管理办法》第十二条上市公司在12个月内连续购买、出售同一或者相关资产的有关比例计算的适用意见—证券期货法律适用意见第11号
Calculation of percentages relating to the purchase or sale of the identical or related assets by listed companies for a continuous period of 12 months clarified.

Managing the auction process
Buying a state-owned enterprise can be a challenging ordeal for a foreign acquirer. To navigate the auction process successfully, a bidder must understand how it is structured and devise a strategy

Form a proper view of new security review rules
New regulation provides details on review procedure