Research On Legal Supervision Of Foreign Investment M&A VIE Model

Since the Internet company Sina created the VIE model to log into the US capital market,the VIE model has been scaled up.This model has become the preferred path for indirect listing of domestic private enterprises and the control of domestic enterprises by foreign companies.The VIE mode is not much different from the usual red-chip mode,but there are certain differences.The red-chip model generally controls the operation of domestic operating entities through foreign-funded WFOE companies in China,or the way in which foreign-invested foreign-invested enterprises from abroad to acquire domestic assets,acquire assets in China,and use assets as capital to establish foreign-funded enterprises.In order to achieve the purpose of controlling domestic industries,the former is equity mergers and acquisitions,and the latter is asset mergers and acquisitions.The VIE model is a foreign-funded WFOE company adopting a series of refined design contract structure to establish a legal level of binding force to achieve the purpose of controlling domestic operating entities.Because this model is a manifestation of the will of the parties or parties,it has certain concealment.For this reason,it can evade the supervision system of foreign investment by the domestic regulatory authorities,and it has a certain vitality in the gray area of supervision.The research focus of this paper is mainly on the domestic risk caused by the application of VIE model in foreign mergers and acquisitions,as well as the legal nature and effectiveness of the VIE model itself,and the defects of the exposed regulatory authorities on VIE.Then the author puts forward corresponding suggestions for improvement based on the above research questions.The writing ideas of this paper are mainly from the foreign capital mergers and acquisitions,cut into the VIE path that is not officially recognized by foreign-invested domestic enterprises,and expound the legal characteristics,legal nature and legal effect of VIE,and use Yaxing Real Estate and Ambow Education.The VIE protocol between the backgrounds focuses on the legal effects of the protocol control model.Finally,it expounds the current status of the VIE model in China,and proposes constructive suggestions for VIE supervision at the current stage.