Keys to transforming institutions for training and rehabilitation to health and elderly care

With China facing an ageing society, the Healthy China 2030 strategy is prioritising transforming outdated training and rehabilitation institutions into health and elderly care institutions.Guidance a

Key due diligence issues for gas M&A

Gas as enterprises can accelerate transformation through M&A, expanding their scale to quickly enter regional markets. This article discusses key points that distinguish legal due diligence issues

From Muji to Manolo: unpicking China’sfirst-to-file system

Charles Feng, partner at East & Concord in Beijing, explains why filing for a trademark early is still a brand’s best bet.

Analysis on Regulation on Standard Contract for Outbound Cross-Border Transfer of Personal Informat

​ PRC Cyberspace Administration issued its Circular on the Draft of Regulation on Standard Contract for Outbound Cross-border Transfer of Personal Information (“the Draft”) on June 30, 2022, in order to seek public opinions. This article aims to briefly illustrate recent progress for this new legislative change.

Brief Analysis on Revision of PRC Anti-Monopoly Law and its Implication

PRC Anti-Monopoly Law (“AML”) which was enacted on August 30, 2007 and implemented since August 1, 2008, has been playing increasingly important role in the development and regulation of Chinese econo

Life Sciences 2022

Pharma & Medical Device Regulation 2022

Healthcare M&A 2021

Overview of the Security Assessment Measures on Cross-border Data Transfer (Draft for Comments)

The Cyberspace Administration of China (hereinafter referred to as the ‘CAC’) released the Security Assessment Measures on Cross-border Data Transfer (Draft For Comments ）(《数据出境安全评估办法(征求意见稿)》, hereinafter referred to as the ‘Measures’) seeking public comments on 29 October 2021. The Draft Measures address the issue of conducting security assessment for transfer of data from China to overseas recipients. This article briefly summarizes the key provisions of the Draft Measures which may impact tho

PRC Data Security Law：Companies' Compliance Obligations

The Data Security Law of the People’s Republic of China (hereinafter referred to as the “Data Security Law”) was adopted and promulgated by the 29th Meeting of the Standing Committee of the 13th Natio

Trends & Developments section of Chambers "Pharmaceutical Advertising 2021"

Rights defects in equity M&A

Equity merger and acquisition (M&A) refers to the way that the acquirer becomes a shareholder of the target company by purchasing the equity of the target company, or subscribing its newly increas

LIFE SCIENCES 2021

PHARMA & MEDICAL DEVICE REGULATION 2021

loi sur la protection des données personnelles

Illustration of the Personal Information Protection Law (Draft)

Exceptions to the notification of undertaking concentration

​Article 22 of the Anti-Monopoly Law (AML) provides two circumstances of notification exception (i.e., notification exemption) of concentration of undertakings. “In any of the following circumstances, undertakings may dispense with notification to the authority for enforcement of the AML under the State Council: (1) one of the undertakings involved in the concentration owns 50% or more of the voting shares or assets of each of the other undertakings; and (2) one and the same undertaking not invo

An Interpretation of FIDIC 2017 Silver Book – From the Perspective of the Overseas EPC Projects Risk

In December 2017, the International Federation of Consulting Engineers (“FIDIC”)[1] published an updated edition of the Conditions of Contract for EPC/Turnkey Projects (“FIDIC Silver Book” or “Silver

Revision of PRC Patent Law Released by National People’s Congress of China

On October 17 2020, Xinhua News Agency revealed the progress of the revision of eight laws, which includes the fourth revision of the PRC Patent Law (the “Law”). The revision attracted huge attention from international IP communities as it addressed multiple issues that has been awaited by international and domestic IP owners.

The legal effect of liquidation preferences

Liquidation preference is frequently used in China’s venture capital and private equity investment sectors. In practice, the legal effect of liquidation preference is also among one of the most frequently consulted legal issues.

Investment, M&A boost tipped for healthcare

The outbreak of COVID-19 in the beginning of 2020 has been recognized as the largest public health emergency since Severe Acute Respiratory Syndrome (SARS). The pandemic has aroused the concern of the public health sector in the context of globalization. It will certainly intensify the development and reform of the healthcare and pharmaceutical industry, which will become a field of interest for the investment and M&A market.

Impact of revised Securities Law on compliance and insider trading

The newly revised Securities Law entered into effect on 1 March 2020. This is the fourth revision, comprehensively revising and improving it in terms of the securities offering system, registration system reform for stock offerings, greatly increasing the cost of securities law violations, enhancing investor protections, and strengthening information disclosure.

New Trends in Data Compliance 2020 and How to Cope With Them

China adopted the Cybersecurity Law in 2017 and issued a series of implementing rules, regulations and national standards for it later. After a development of over two years, what compliance regulation environment we will be facing in 2020? Will the identification and protection of critical information infrastructure (“CII”) enter a new phase? What problems will be encountered in cross-border data transfers? What are the challenges that will confront the enterprises trying to be compliant? With

Legal risks of share acquisitions in liquor makers

In China, the liquor market shows a trend of steady and sound development along with the development and maturity of food industry. The Catalogue for Guiding Industrial Restructuring, which became ope

Key points of revised restructuring and listing rules

On 18 October 2019, the China Securities Regulatory Commission (CSRC) issued the Measures for the Administration of Major Assets Restructurings of Listed Companies (revised in 2019), which amended the basic rules for restructuring and listing of listed companies on the main board market and the Growth Enterprise Market (GEM).

​China’s Compliance Requirements on Personal Data Protection

China’s Compliance Requirements on Personal Data ProtectionCybersecurity and personal data protection witnessed rapid legislative developments in years of 2018 and 2019, while intensive enforcement ac

Anti-Monopoly Law Enforcement: 2019 Year in Review (Part Ⅲ)

7. Private ActionsChina is a jurisdiction which allows both standalone and follow-on antitrust actions. Although the number of standalone actions are steadily growing in China, follow-on actions and

Anti-Monopoly Law Enforcement: 2019 Year in Review (Part II)

4. RPMComparing to 2018 where there was only 1 infringement decisions concerning resale price maintenance (RPM), 4 RPM cases were concluded in 2019. Changan Ford and Toyota Motor were respectively fi

Anti-Monopoly Law Enforcement: 2019 Year in Review (Part I)

1. IntroductionYear 2019 was the first full calendar year for the State Administration for Market Regulation (SAMR) to work as China’s uniform antitrust enforcement agency following the institutional

China Seeks More Deterrence Power for Its Anti-Monopoly Law

On the first business day of Year 2020, China published for public comments a draft revisions to its Anti-Monopoly Law (“Draft Revisions”). The Draft Revisions contemplates a number of important chang

Toll road investment, financing and M&A

A toll road is defined as a road (including a bridge and tunnel) that complies with the Highway Law and the Regulation on the Administration of Toll Roads, for which highway tolls are charged, with approval. According to the regulations, investors may participate in the operation and management of toll roads by an investment in the construction of privately operated roads, and the acceptance of the transfer of rights and interests in toll roads.

Chinese Data Protection Law: How Long to March to Meet GDPR Standard?

Introduction: the active legislation of personal information protection in ChinaThis October, Information Security Technology - Personal Information Security Specification (GB/T-35273/2018) (“Personal

Central SOEs Transferring Offshore Property Rights to Acquirers

In general, we advise parties to transfers of central SOEs’ offshore property rights to take the previous concerns into account at an early stage so they may make reasonable arrangements for the overall process.

The Impact of Revision of PRC Trademark Law

The fourth revision of the PRC Trademark Law attracted wide attention internationally.

Brief Analysis of Revised Technical Import and Export Regulation

On March 2, 2019, the State Council, the top administrative body of China issued the Decision on Revision of several Administrative Regulation, which includes the revision of Technical Import and Export Regulation (the “TIER”).

Brief Analysis of Revised Technical Import and Export Regulation

On March 2, 2019, the State Council, the top administrative body of China issued the Decision on Revision of several Administrative Regulation, which includes the revision of Technical Import and Export Regulation (the “TIER”).

Prevention and Control of Tax Risks in Equity M&A

Tax concerns over an equity merger and acquisition may have a profound impact on key issues like the transaction plan and related costs.

Significant Changes in 2018 to China’s Arbitration Legal Structure

On June 27, 2018, the Supreme People’s Court of the People’s Republic of China (“Supreme Court”) promulgated a new judicial interpretation-Provisions of the Supreme Court on Several Issues Regarding the Establishment of the International Commercial Court. Article 2，Article 11 and Article 14 of the Interpretation provide that the International Commercial Court has jurisdiction of cases involving applications for preservation orders[1] in arbitration procedure, for setting aside or enforcement of

Buyout Funds in Mixed-Ownership Reforms of SOEs

The main objective of a buyout fund is to secure control of an enterprise during its growth or mature phase before increasing its value through a restructuring or other such means. Perhaps, from the perspective of supply side structural reforms, the indirect participation in the mixed-ownership reform of SOEs through buyout funds will become the best route for private capital.

Avoid “Academic Promotion Commercial Bribery” in Medicine Marketing

Medicine marketing has long had a high risk of being prone to commercial bribery. As such, it is not surprising this has been a business that China strictly regulates and has cracked down on in recent years. It is important to uncover, as well as prevent, commercial bribery in medicine marketing, be it in daily operations, in mergers and acquisitions or capital operations of pharmaceutical enterprises.

Preventing Risk in Medical Institution Acquisitions

With the government promulgating a series of policies to encourage and guide social capital to develop medical and health undertakings in recent years, social capital is constantly participating in M&A, reorganization and restructuring of medical institutions. Among them, non-profit medical institutions are more encouraged by the government and have gradually become a new hotspot for investment. Due to its particularity, such acquisitions are different from ordinary acquisitions of shares, and t

Financial Institutions to Raise the Ratio of Foreign Shareholding

InAugust 2017, the State Council promulgated the “Notice on Several Measures for Promoting the Growth of Foreign Investment”. In order to deepen the supply-side structural reform, China will further lift admittance restrictions on foreign investment, expand the scope of market access and promote the opening up of banking, securities and insurance industries to the outside world, and clarify the opening-up schedule and road map.

Foreign Investment Restrictions in P2P Lending Intermediaries

The Interim Administrative Measures for the Business Activities of Peer-to-Peer Lending Information Intermediaries define “peer-to-peer lending” as direct lending/borrowing realized between peers on an internet platform. Peers include natural persons, legal persons and other organizations.

Senior Care Enterprises Offer Foreign Buyers Opportunity

The senior care industry in China is a sector in which the government is focusing its support. China has a population of approximately 200 million elderly, a number that will increase to 400 million by 2050, making China the country with the world’s largest population of people aged 60 and older.

Types and Targets of Inbound M&A by Foreign Investors

Foreign investors in China typically set up wholly foreign-invested companies or partner with Chinese investors to establish Sino-foreign joint ventures or co-operative enterprises. To penetrate the Chinese market and speed up the execution of their investment plans in China, foreign investors are inclined to merge or acquire domestic corporates with an established sales network and factory equipment, so as to obtain the greatest returns in the shortest timeframe.

Key Points in Due Diligence on Sporting Event IP in China

Since the issuance by the State Council of the Several Opinions of the State Council on Accelerating the Development of the Sports Industry and Promoting Sports Consumption on 2 October 2014, the Chinese sports industry has become a new growth driver in the market, with relevant M&A cases and purchases of sports assets greatly increasing.

Concentration of Undertakings Involving Intellectual Property

The office of the State Council’s Anti-Monopoly Commission issued the Anti-monopoly Guidelines on Abuse of Intellectual Property (Draft for Comment) on 23 March 2017. The draft document has a chapter dedicated to the concentration of undertakings involving intellectual property (IP), which embodies a law enforcement model of applying the general principles and analytical framework for anti-monopoly review of concentrations between undertakings and also takes into consideration the characteristic

Domestic Oversight of Foreign Acquisitions by Listed Companies

In 2016, direct foreign non-finance investment by Chinese enterprises reached US$170 billion, with listed companies becoming the central force in foreign acquisitions. However, as compared to other enterprises, listed companies face more complex approval procedures for their foreign acquisitions.

Risks in Acquisitions, Restructurings by Listed Companies in China

The term “acquisition/restructuring” as carried out by a listed company means a rights assignment of corporate control carried out between a target company and an acquiring company. As acquisitions/restructurings carried out by listed companies are accompanied by massive capital operations, they will regularly give rise to serious criminal legal risks. Raising funds. For the acquirer, relying on its own assets to complete the acquisition is usually not possible.

The Boundary of Due Diligence in Mergers & Acquisitions

Legal due diligence is an indispensable link for enterprises in the implementation of mergers and acquisitions (M&A). An effective due diligence report should make conclusive opinions based on a f

Copyright Risks in M&A Transactions

Corporate acquisition is one method by which a company may secure and strengthen its intellectual property (IP) rights against its competitors to increase its market share. Corporate acquisition is generally divided into three types – corporate merger, equity acquisition and asset acquisition, which involves more complex IP issues.

Key Points of Merger and Acquisition for Military Defense Enterprises

At a meeting with the People’s Liberation Army delegation during the third session of the 12th National People’s Congress in March 2015, President Xi Jinping said for the first time that the integration of military and civilian development should be upheld as a national strategy.

Legal risks that should be paid attention to in hospitality industry acquisition

he growing clientele are driving mid-to-high-end, chained and limited-service hotels in China to upgrade their brand and services. Meanwhile, major hotel brands are losing no time in building their presence at core locations of most visited cities through quick M&A transactions. Except for legal risks customarily associated with M&A transactions, points summarized below need extra attention in the process of performing due diligence and drafting transaction documents:

Overview of recent policies on SOE mixed-ownership reforms

Reform of state-owned enterprises (SOE) has markedly accelerated in recent years. The author wishes to briefly sift and sort the policies on the mixed-ownership reform of SOEs under the central government and in key municipalities during the past three years. Central policies. On 24 August 2015, the Central Committee of the Communist Party of China and the State Council issued the Guiding Opinions on Intensifying the Reform of SOEs (the guiding opinions), setting forth guiding principles for pr

Due diligence investigation of domestic mining mergers and Acquisitions Law

China’s 13th Five-Year Plan pointed out that the central government should support mining enterprises to upgrade technologies, guide the merger and acquisition (M&A) of small mines, and close outdated and environmentally unfriendly mines. In the Development Plan for the Nonferrous Metals Industry (2016-2020), the Ministry of Industry and Information Technology said the regional consolidation of mines should be promoted across the country to expedite large-scale development and intensive use of r

State-owned property transfers in corporate M&A

State-owned properties, broadly speaking, are various forms of property that arise as a result of state-made investments. Corporate mergers and acquisitions (M&A) are generally divided into asset and equity M&A. As asset acquisitions involve such issues as title to the assets, and taxes and levies, in practice corporate M&A, where the subject matter is equity, are more common. In corporate M&A, the issue of the transfer of state-owned properties exists regardless of whether an ordinary joint sto

Issues with transfer of staff during M&A transactions

Merger and acquisition (M&A) transactions involve not only the transfer of assets, equity and debts, but also issues with the transfer of staff. Here there are two major concerns: how working hours are counted in the original working unit; and how economic compensations are paid. In this article, the authors briefly analyze these two concerns under different M&A transaction scenarios.

Patent due diligence in high-tech acquisitions

atents are a focal issue in the acquisition of high-tech companies, as the acquisition of the patents of the target company is usually the motivation for acquiring such companies. If, in an acquisition of a high-tech company, investigation of the patent situation of the target company is not thorough, it could impact the outcome of the strategic acquisition. More seriously, the acquired patents could instead become a heavy burden on the acquirer. Accordingly, in addition to carrying out the due

Relaxing restrictions for foreigners entering the services industry

Opening up the domestic market and attracting foreign investment have become important goals of national policies. Ever since the introduction and execution of the One Belt, One Road initiative, the services industry has become a key area to attract foreign investors. This has also brought about new opportunities for foreign investors to enter the domestic market. The recent relaxation on restrictions for foreign investment entry is explained below.

Judicial review standard of directors' duty of loyalty

Directors of a corporation are authorized to act on its behalf, ensuring proper management of corporate assets internally and having business dealings with outsiders externally. As fiduciaries, directors have duties of a fiduciary nature towards the corporation. However, when the corporation becomes the target of a proposed takeover, the decision made by its board of directors in response to the takeover offer may give rise to conflicts of interest between directors and the corporation.

Tech upgrade, transformation and relocation for M&A

In recent years, many high-pollution and hazardous chemical enterprises have been required to eliminate outdated production facilities, change their lines of production or simply close down their business or relocate assets, as required by governmental regulations such as the Notification on Stopping Industries with Overcapacity from Further Blind Expansion, and the Guidelines on Solving the Crisis of Severe Overcapacity, with a view to helping with the national drive for supply-side reform. Loc

Criminal risk of professional embezzlement in M&A

In a market-oriented economy, resources can be optimally allocated through mergers and acquisitions (M&A). An M&A is a complex process, harbouring large legal risks. How to avoid such legal risks is one of the most important matters in M&A activities. However, criminal risk is an area that draws relatively little attention in M&A legal services.

Dispute Resolution Methods in M&A

In acquisition agreements there is one important provision that fails to draw the attention that it deserves, namely, the provision on the dispute resolution method. According to the author’s experience, in many commercial acquisitions in which disputes arose, the choice of an arbitration institution or a court as the means of dispute resolution was originally made based on a feeling rather than reason. However, whether an effective award rendered by an arbitration institution, or an effective

Interpretation of Notice to Regulate the Bond Transactions of Bond Market Participants

Background of the introduction of the Notice In recent years, as the Chinese bond market has been developing continuously, the investors want and need to participate in the bond investment more. Howev

An Analysis of the Practice of Handling Registration Information Change after Winning the Right of M

On December 30, 2015, the Supreme People’s Court issued (2015) Zh. F. Zi No. 37 reconsideration decision to uphold (2015) J. Zh. Zi No. 5 penalty decision that was made by Hebei Higher People’s Court on the act of Inner Mongolia Autonomous Region Department of Land and Resources of failing to fulfill its execution assistance duty without any good reason. What was demonstrated in the case is the problem that the right of mining is hard to be executed in practice. While providing services for the

An Analysis of the Non-competition Clause in Private Equity Investment Agreements

Along with its rapid development, the private equity investment market has become an important force for driving the development of enterprises in China. For most enterprises, the most valuable property is men—men with professional intellectual properties, men with advanced business concepts, men with extensive market resources—who push the enterprises forward to realize leapfrog development. When making investment, private equity investors shall pay enough attention to the target company’s staf

Can Timestamp be Truly Trusted

As the Internet economy is thriving, the way people see, consider and handle things is changing to be “Internet-based.” More and more e-signatures, e-contracts, e-certificates and e-evidence appear in judicial cases. The traditional way of e-evidence preservation used to be notification, which is costly. People have a pressing demand for the less costly preservation of e-evidence, and the trusted timestamp service comes just in time. Trusted timestamp refers to a legally effective electronic cer

Near-term Impact of the Annulment of Measures for Administration on Foreign Investment in Leasing Sc

On February 22, 2018, the Ministry of Commerce issued Decision of the Ministry of Commerce on Amending Some Rules and Regulatory Documents (Order No. 1 [2018] of the Ministry of Commerce), in which it decided to annul Measures for the Administration of Foreign-funded Lease Industry which was released on February 17, 2005, effective March 5, 2005 and amended on October 28, 2015 (Order No. 5 [2005] of the Ministry of Commerce). This caused widespread concern in the industry about what impact the a

Review of innovation market merger remedies in China

Compared with concentrations in traditional industries, mergers in innovation markets have unique features. On the one hand, these mergers can harm competition to a greater extent by eliminating nascent competition in the relevant markets.