Study On Legal Issues Of Offshore Company's Foreign Investment

Along with the rapid development of the economic globalization, offshore companies have been active in the stage of international and domestic economic life due to its inherent characteristics and thus attracted great attention of the investors and related parties. However, while they bring a large number of investment opportunities and profits for the investors and related parties, they also have a significant impact on the foreign investment policies of various countries.As a developing country using a huge amount of foreign capitals, the positive functions, as well as the negative influence, of the offshore companies have gradually penetrated into China. It is so common that the foreign investors use offshore companies to make the investment in China, and that domestic residents conduct round-trip investment through offshore companies or set up offshore companies to achieve the purpose of listing the company in the overseas countries through an indirect way. However, the regulatory system for offshore companies is not so well-established in China, even remains blank in some areas. The rapid development of offshore companies and the lagging of an effective regulatory system have caused a series of problems, such as huge losses of state-owned properties and revenues, capital flights, etc. Therefore, how to effectively regulate the offshore companies' investment activities in the PRC by legal means has become a major issue.This thesis mainly studies the three typical forms of offshore companies which are usually operated in the PRC, analyzes the PRC regulations related to offshore companies and relevant provisions of related countries, and thus proposes some constructive suggestions regarding how to establish and further improve the PRC regulatory system for offshore companies.This thesis (exclusive of the Preamble and the Peroration) can be divided into five chapters:Chapter I deals with the general introduction of offshore companies. By introducing the meaning of "off shore" and "offshore jurisdiction", as well as comparing the different understandings on the concept of offshore companies in current theoretical circles, the author expressed her own idea on the definition and the legal characteristics of offshore companies. Following this, the author further analyzes the advantages and the negative impacts of offshore companies.Chapter II describes the development status of offshore companies in the PRC and respectively introduces the three typical forms of offshore companies which are usually operated in the PRC, that is, the investment by foreign investors through offshore companies, the round-trip investment by domestic residents and the red-chip listing.Chapter III elaborates the current Chinese regulatory system on the afore-mentioned three forms of offshore companies and thus analyzes the defections of the exsiting regulatory system.Chapter IV introduces the regulations on offshore companies enacted by related international organizations and other countries.Chapter V gives constructive suggestions on improving the current PRC regulatory system for offshore companies. Although the offshore companies are double-edged swords to some extent, we shall believe that as long as there are sound legal mechanisms to regulate them, they must be able to play a more positive effect on the development of our economic construction.