Type of M&A (Million Dollars) Requirement Asset M&A In accordance with the requirement for newly established foreign-invested company Equity M&A Registered capital<2.1 Total Capital < 10/7 * Registered capital 2.1<5 Total Capital < 2 * Registered capital 5<12 Total Capital < 2.5 * Registered capital Registered capital>12 Total Capital < 3 * Registered capital
The price for the actual transactions may rationally float against the specific valuation results. Special state provisions should be considered on the transfer of the state-owned assets. Foreigners are prohibited from diverting capital abroad in a disguised form by transferring share rights or selling assets at a price obviously lower than the valuated one.
The M&A Provisions requires that the assets appraisers shall adopt the appraisal methods internationally used.
Type of M&A Calculation Method Asset M&A Total pain in capital Equity M&A Only purchase equity Original registered capital Purchase added equity Original registered capital+ Added capital
The percentage of foreign investment may be determined as the ratio of the capital contribution by foreign investors against the capital contribution by all the investors to the registered capital.
The contribution by foreign investors to the registered capital of the equity joint ventures should be no less than 25% in general. Where the proportion is less than 25%, it shall get the approval and make registration. Investments contributed by the foreign investors lower than 25% upon the M&A shall no enjoy tax reduction treatment […]
If you would like to subscribe our RSS, please copy and paste the following link to your RSS Reader.
You can also click the above link to view the updated information.