Reverse Acquisition Of Chinese Enterprises Listed On The Legal Problems In The US

This paper is featured as the first systematic study on the legal issues regarding the securities reverse merger in the United States. In response to the need of China's development and regulation on such filed, this lucubration mostly addresses the following questions: What is reverse merger? What are the relevant prescriptions and interpretations in the US statutory or case laws? What is the practice in the reverse merger? Through exploring such questions and China's status, it will help the corporations understanding.In the United States, reverse merger has been long time. Today, about 40% corporations of exchange market do so. As an important supplement to public offering, reverse merger has good reason to become part of our securities market, and is able to perform various functions for China's reform, restructuring and open-up. However, up to date, there is scarcely such kind of offering as reverse merger in its real sense, there is not systematic regulatory. Furthermore, to ensure the sound development of securities reverse merger, obstacles have to be removed in the areas of laws markets, institution and cognition.In order to understanding the reverse merger to the American securities market clearly, the paper introduce the information of the securities market of the United States. Reverse merger start from the over the count market, so we must acquire the basic information of the securities markets of America, finding the relevance of the securities markets and relation between the markets and the SEC or NASD.Free land is a hot point, it is also the center in reverse merger because it is the important middle part. Beside convenience in the registration procedure and sweetener in free tax, it also is used in avoiding the obstacles in the Chinese policy.Practice of reverse merger is well-known in China, but theory of reverse merger is less value thing except simple one. This paper includes some tentative plan brought forward by the author to better reverse merger in China, and hopefully can serve as a platform for the further research on such subject.