On The Operation Of The Off Shore Company And Its Legal Regulation

In China, almost all state-owned or private enterprises in overseas investment, trade and services in theuse of offshore companies, especially listed companies. Most of the foreign direct investment in China tomention the organizational form of the offshore company, therefore, the Government recognized thepositive sense the presence of the offshore company. In May1989, approved by the People’s Bank of China,China Merchants Bank to set up offshore banking, which is the first joint-stock commercial bank approvedby the Chinese government to engage in offshore banking. From1992to2002, the Chinese governmenthave approved the head office of the Guangdong Development Bank, Shenzhen Branch of ICBC,Agricultural Bank of China Shenzhen Branch, Shenzhen Development Bank, Pudong Development Bank,and the Bank of Communications to set up offshore banking. The main source of offshore banking fromoffshore companies. According to the statistics of the Ministry of Commerce, the origin of investment offoreign companies to invest in China, Hong Kong and the British Virgin and Cayman offshore companycontinuous train the top ten. Law of foreign-invested enterprises in China, a Sino-foreign joint venture lawand corporate income tax law for any company established under foreign law outside investment in Chinato implement fair treatment.Currently, legislation and practice in China is to take the registration standards, as provided for insection199of the Companies Act, a foreign company, a company registered and established outside Chinaunder foreign law. Its drawback is impossible to regulate foreign capital utilization the indirect holdingcorporate acquisitions ways to circumvent the laws and policies of the host country’s situation. Therefore,we should consider the applicable fund source standards as the basis of defined foreign additions. Inaddition, there are a lot of private enterprises to set up a company outside and then return to the domesticcapital market, a listed company M&A mode will have to conduct case analysis. Principle to stringentreview, to prevent the emergence of the rights and obligations of domestic and foreign investors not. Theoffshore company can be smoothly in domestic bank to open an account, but, after all, a foreign company,not in the domestic industrial and commercial tax filing, offshore companies can not provide verificationform, declarations, can not export declaration. Offshore companies advertised shortcut flow of funds once they left the agency this tree, Flower in the Mirror, in the water. Offshore company open a bank accountregardless of the Mainland or abroad (basically offshore accounts are opened in the country that can beengaged in the offshore business bank, such as some of the foreign banks such as Shenzhen DevelopmentBank and other mainland banks), his form of currency can only operate in foreign currency in the formmeans that the money in offshore accounts in foreign currency forever, and not the yuan.In addition, many people set up offshore companies choose where to set up an offshore company is notaware of. Professional should be consulted before blindly company established not only fail to achieve itsinvestment objective, but registration is facing the loss of the annual registration fee. In fact, before theregistration of offshore companies need to have a lot of work, for example: to understand the actualsituation of the enterprise, a series of questions about registered tax law, legal, foreign exchange controls,financial policies. Thereby generates a series of problems in practice have to be solved.Offshore company is relatively late age of China’s rise, although the company in the form of themodes during the establishment of the country’s economic development, foreign economic and trade, tofurther promote the improvement of China’s market economic system in the sound, but in academia andtheorists the company policy is very rare contemporary Western developed countries, especially countrieswith offshore heart compared very lag. Therefore produce some adverse regulatory measures, resulting in alarge number of economic loss of good economic order should not be stable. Currently, for in our country,there is no special legal text relating to offshore companies to be regulated, the majority exists in theCompanies Act, the general provisions of the Foreign Equity Joint Ventures "," Enterprise Income Tax Lawand other relevant laws and regulations, which are scattered see laws and regulations, but also just someabstract theoretical basis, the lack of effective oversight and management practices. In this regard, deepenespecially important to study the operation of the company and its regulators, is also the need to study itstheoretical significance of this system. Improvement of the system of legal norms, learn from the developedcountries under the foundation, and further contribute to a thin edge to promote building a country underthe rule of law in China. Better guidelines China’s economic modernization, marketization,internationalization rapid development, improve and perfect the system of our company.China to promote China’s economy to the world at the same time with the offshore company, perhapstoo eager, ahead stance must be given to the enterprise too relaxed international environment, bring stability and security to the world economy greatly harm, for the maintenance of good economic order tocause a lot of adverse impact. This article from the basic theory of the offshore company analyzes, toexamine its advantages and disadvantages of posture, and learn from foreign legislative practice, on thisbasis, further regulation and perfect the legal system the status quo.