What are investments of a Chinese company?
Chinese companies often have complex investment structures, with both the company entity and its senior officers holding investments in one or more business venture.
Understanding the investment landscape of a Chinese company can help you make informed decisions as you put together your plan to work with a Chinese company.
As with many companies around the globe, Chinese companies – and their officers and other senior managers – can legally hold investments in other companies. With that said, there are rules and regulations to which the companies and representatives must abide and disclose their investment interests.
The primary document where you will find information about the investments a company holds is the Chinese Annual Return, a central document in your portfolio of materials. If the company holds investments in another company it also must provide that information, including the company name in which the investment is held and the company registration number. That document also will give you valuable information about the Chinese company director and the ultimate beneficiary owner, two roles that also may have bearing on a Chinese company’s organizational or investment structure. You may want to make sure that the other entities in which the company you are looking into has invested, is a legal, registered business with a clean track record.
Finally, you’ll want to understand the difference between registered capital and paid-up capital, as both are important segments in a Chinese company’s finances.
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