Article 28 An overseas company mentioned in this chapter shall be established according to law, and its place of registration shall have a sound enterprise legal person system, and the company and its management have not been punished by the regulatory authorities in the last three years; In addition to the special purpose companies specified in the third section of this chapter, overseas companies should be listed companies, and their listing places should have a sound securities trading system.
Article 29 A foreign investor who acquires the equity of a domestic company or a foreign company involved in a domestic company by way of equity shall meet the following conditions:
(1) It is legally held by shareholders and can be transferred according to law;
(2) No ownership dispute, no pledge or any other right restriction;
(3) The equity of an overseas company shall be listed and traded in the overseas open and legal securities exchange market (excluding the OTC market);
(4) The equity of overseas companies has been stable in recent 1 year.
Items (3) and (4) of the preceding paragraph shall not apply to the special purpose company specified in Section 3 of this chapter.
Article 30 When a foreign investor merges a domestic company by way of equity, the domestic company or its shareholders shall employ an intermediary agency registered in China as a consultant (hereinafter referred to as "merger consultant"). M&A consultants shall conduct due diligence on the authenticity of M&A application documents, the financial status of overseas companies, and whether M&A meets the requirements of Articles 14, 28 and 29 of these Provisions, and issue M&A consultants' reports to express clear professional opinions on the above contents one by one.
Article 31 A merger and acquisition consultant shall meet the following conditions:
(a) Good reputation and relevant experience;
(2) No record of major violations of laws and regulations;
(3) Have the ability to investigate and analyze the legal system of the place of registration and listing of overseas companies and the financial situation of overseas companies. Article 32 A foreign investor's acquisition of a domestic company by equity shall be submitted to the Ministry of Commerce for approval. In addition to the documents required in Chapter III of these Provisions, domestic companies shall also submit the following documents:
(1) Description of the changes in the equity and major assets of domestic companies in recent 1 year;
(2) Report of merger and acquisition consultant;
(3) The business opening certificates or identity documents of the domestic and foreign companies involved and their shareholders;
(4) A description of the shareholding of the shareholders of the overseas company and a list of shareholders holding more than 5% of the shares of the overseas company;
(five) the articles of association of the overseas company and the description of the external guarantee;
(6) The audited financial report of the overseas company in the last year and the stock trading report in the last six months.
Article 33 The Ministry of Commerce shall, within 30 days from the date of receiving all the required documents, examine the application for merger and acquisition, and issue a certificate of approval if it meets the requirements, and indicate on the certificate of approval that "the merger and acquisition of domestic companies by foreign investors is valid within 6 months from the date of issuance of the business license".
Article 34 A domestic company shall, within 30 days from the date of receipt of the endorsed approval certificate, register the change with the registration administration and the foreign exchange administration, and the registration administration and the foreign exchange administration shall issue a business license and a foreign exchange registration certificate with the words "valid for 8 months from the date of issuance" respectively.
When a domestic company goes through the change registration with the registration authority, it shall submit the application for equity change, amendment of articles of association, equity transfer agreement and other documents signed by the legal representative of the domestic company in advance to restore the equity structure.
Article 35 Within six months from the date of issuance of the business license, domestic companies or their shareholders shall apply to the Ministry of Commerce and the foreign exchange bureau for approval and registration of enterprises with overseas investment.
In addition to submitting the documents required by the Provisions on Examination and Approval of Enterprises with Foreign Investment to the Ministry of Commerce, it shall also submit the annotated approval certificate of enterprises with foreign investment and the annotated business license of enterprises with foreign investment. After the Ministry of Commerce approves domestic companies or their shareholders to hold shares in overseas companies, it will issue the Approval Certificate for Overseas Investment of China Enterprises and issue a new approval certificate for foreign-invested enterprises without marking.
After obtaining the approval certificate of an enterprise with foreign investment without annotations, a domestic company shall, within 30 days, apply to the registration authority and the foreign exchange administration for renewal of the business license and foreign exchange registration certificate of the enterprise with foreign investment without annotations.
Thirty-sixth within six months from the date of issuance of the business license, if the domestic and foreign companies have not gone through the formalities for the change of equity, the approval certificate and the Approval Certificate for Overseas Investment of China Enterprises will automatically become invalid. The registration authority approves the change registration according to the application documents for the change registration of shares submitted by domestic companies in advance, so as to restore the ownership structure of domestic companies to the state before the equity merger.
If the merger and acquisition of domestic companies to issue additional shares is not realized, before the registration authority approves the change registration in accordance with the provisions of the preceding paragraph, the domestic company shall also reduce the corresponding registered capital in accordance with the provisions of the Company Law and make a public announcement in the newspaper.
If a domestic company fails to go through the corresponding registration formalities in accordance with the provisions of the preceding paragraph, it shall be handled by the registration authority in accordance with the relevant provisions of the Regulations on the Administration of Company Registration.
Article 37 Before obtaining the unmarked approval certificate and foreign exchange registration certificate of foreign-invested enterprises, domestic companies shall not distribute profits to shareholders or provide guarantees to affiliated companies, and shall not pay for foreign-funded projects such as share conversion, capital reduction and liquidation.
Article 38 A domestic company or its shareholders shall register tax changes with the tax authorities with the approval certificate and business license without comments issued by the Ministry of Commerce and the registration authority. Article 39 Special purpose companies refer to overseas companies directly or indirectly controlled by domestic companies or domestic natural persons for the purpose of listing the rights and interests of domestic companies abroad.
The provisions of this section are applicable to shareholders of special purpose companies who purchase shares of shareholders of domestic companies or shares issued by domestic companies by means of payment in order to achieve overseas listing.
If the parties take an overseas company holding the rights and interests of a special purpose company as the main body of overseas listing, the overseas company shall meet the relevant requirements of this section for special purpose companies.
Article 40 The overseas listing and trading of a special purpose company shall be approved by the the State Council Securities Regulatory Authority.
The country or region where a special purpose company is listed overseas shall have a sound legal and regulatory system, and its securities regulatory agency has signed a memorandum of understanding on regulatory cooperation with the securities regulatory agency in the State Council, and maintained an effective regulatory cooperation relationship.
Article 41 A domestic company whose rights and interests mentioned in this section are listed overseas shall meet the following conditions:
(1) The property rights are clear, and there are no property rights disputes or potential property rights disputes;
(2) Its business system is perfect and it has good ability of continuous operation;
(3) Having a sound corporate governance structure and internal management system;
(4) The company and its major shareholders have no record of major violations of laws and regulations in the last three years.
Article 42 A domestic company that establishes a special purpose company overseas shall apply to the Ministry of Commerce for approval. When a domestic company goes through the formalities of examination and approval, it shall submit the following documents to the Ministry of Commerce in addition to the documents required by the Provisions on Examination and Approval of Enterprises with Overseas Investment:
(a) the identity certificate of the actual controller of the special purpose company;
(2) A business plan for the overseas listing of the special purpose company;
(3) M&A consultant's evaluation report on the issue price of the future overseas listed shares of the special purpose company.
After obtaining the Approval Certificate for Overseas Investment of China Enterprises, the founder or controller shall apply to the local foreign exchange administration department for the corresponding foreign exchange registration procedures for overseas investment.
Article 43 The total issue price of the shares of a special purpose company listed overseas shall not be lower than the corresponding equity value of the merged domestic company as assessed by the relevant asset appraisal institutions in China.
Article 44 Where a special purpose company acquires a domestic company by means of equity, the domestic company shall submit the following documents to the Ministry of Commerce in addition to the documents required in Article 32 of these Provisions:
(a) the approval documents and certificates of overseas investment in the establishment of a special purpose company;
(2) Foreign exchange registration form for overseas investment of special purpose companies;
(3) The identity certificate, business commencement certificate and articles of association of the actual controller of the special purpose company;
(4) A business plan for the overseas listing of the special purpose company;
(5) M&A consultant's evaluation report on the issue price of the future overseas listed shares of the special purpose company.
If an overseas company holding the rights and interests of a special purpose company is the main body of overseas listing, the domestic company shall also submit the following documents:
(1) The business license and articles of association of the overseas company;
(2) A detailed explanation of the trading arrangements and discount methods made by the special purpose company and the overseas company on the equity of the merged domestic company.
Article 45 If the Ministry of Commerce gives preliminary approval to the documents specified in Article 44 of these Provisions, it shall, in principle, issue a letter of approval, and the domestic company shall submit the documents applying for listing to the the State Council securities regulatory authority with this letter of approval. The State Council Securities Regulatory Authority decides whether to approve or disapprove within 20 working days.
After being approved, a domestic company shall apply to the Ministry of Commerce for an approval certificate. The Ministry of Commerce issued a certificate of approval with the words "the overseas special purpose company holds shares, which is valid for 1 year from the date of issuance of the business license".
If the merger and acquisition results in the change of the equity of the special purpose company, the domestic company or natural person holding the equity of the special purpose company shall, on the strength of the approval certificate of the foreign-invested enterprise, go to the Ministry of Commerce to handle the examination and approval procedures for the change of the overseas investment and start-up enterprise related to the special purpose company, and apply to the local foreign exchange management authority for the registration of the change of foreign exchange investment.
Article 46 A domestic company shall, within 30 days from the date of receipt of the endorsed approval certificate, register the change with the registration administration and the foreign exchange administration, and the registration administration and the foreign exchange administration shall issue a business license and a foreign exchange registration certificate with the words "valid within 0/4 months from the date of issuance" to the foreign-invested enterprise respectively.
When a domestic company goes through the change registration with the registration authority, it shall submit the application for equity change, amendment of articles of association, equity transfer agreement and other documents signed by the legal representative of the domestic company in advance to restore the equity structure.
Article 47 A domestic company shall, within 30 days from the date when a special purpose company or an overseas company associated with a special purpose company completes its overseas listing, report to the Ministry of Commerce the plan for overseas listing and repatriation of financing income, and apply for renewal of the approval certificate of a foreign-invested enterprise, without annotation. At the same time, domestic companies shall report the overseas listing to the the State Council securities regulatory authority within 30 days from the date of completion of overseas listing, and provide relevant filing documents. Domestic companies should also submit a plan for the repatriation of financing income to the SAFE, which will supervise the implementation. After obtaining the unmarked approval certificate, a domestic company shall, within 30 days, apply to the registration authority and the foreign exchange administration for renewal of the business license and foreign exchange registration certificate of the unmarked foreign-invested enterprise.
If the domestic company fails to report to the Ministry of Commerce within the aforesaid time limit, the approval certificate of the domestic company will automatically become invalid, and the equity structure of the domestic company will be restored to the state before the equity merger, and the change registration procedures will be handled in accordance with Article 36 of these Provisions.
Article 48 The overseas listing financing income of a special purpose company shall be repatriated for domestic use in accordance with the repatriation plan filed with the foreign exchange bureau and the current foreign exchange management regulations. Financing income can be remitted in the following ways:
(1) Providing commercial loans to domestic companies;
(2) Newly established foreign-invested enterprises in China;
(3) Merger and acquisition of domestic enterprises.
Under the above circumstances, the overseas financing income of the special purpose company should be transferred back to China's laws and administrative regulations on foreign investment and foreign debt management. If the overseas financing income of a special purpose company is repatriated to China, resulting in the increase of the equity of the special purpose company or the increase of the net assets of the special purpose company by domestic companies and natural persons, the parties concerned shall truthfully disclose and submit for approval, and handle the corresponding foreign exchange registration and overseas investment registration changes after completing the examination and approval procedures.
Foreign exchange income from profits, dividends and capital changes obtained by domestic companies and natural persons from special purpose companies shall be repatriated within 6 months from the date of acquisition. Profits or dividends can enter the current account foreign exchange account or settlement. With the approval of the foreign exchange administration, the foreign exchange income from capital changes can be kept in the special account for capital projects, or can be settled after the approval of the foreign exchange administration.
Article 49 If the domestic company fails to obtain the approval certificate without endorsement within 1 year from the date of issuance of the business license, the endorsement approval certificate will automatically become invalid, and the change registration formalities shall be handled according to Article 36 of these Provisions.
Article 50 After the overseas listing of a special purpose company is completed, and the domestic company obtains the unmarked approval certificate and business license, if the parties continue to acquire the domestic company by means of payment, the provisions in Sections 1 and 2 of this chapter shall apply.