INTERNATIONAL TRADE AND ECONOMICS ARE INVASIVE AND ASSIDUOUS ... VERY MESSY LIKE TRYING TO PUT THE TOOTHPASTE BACK INTO THE TUBE ... WORLD ECONOMICS IS LIKE A RAINBOW ... ONE COLOR DOESN'T EXIST WITHOUT THE FULL PANORAMIC EMBRACING A MULTITUDE OF RISK STRUCTURES AND GOVERNMENT POLICIES ... SO WHAT MECHANISM CAN BE USED TO TEMPER THE ABUSIVE NATURE OF HUMAN EGO IN THE ENTERPRISE?
READING AND EXPLORING THIS MATERIAL IS A GOOD STARTING POINT ---> https://www.uscc.gov/sites/default/files/2023-01/Chinese_Companies_Listed_on_US_Stock_Exchanges_01_2023.pdf OR RATHER A STRUCTURE TO HANG QUESTIONS ON.
The PRC legally prohibits foreign direct investment in certain industries, including many high-tech sectors, and maintains strict controls on foreign exchange and capital flows. To circumvent these restrictions, mainland Chinese companies interested in raising funds on U.S. exchanges create offshore corporate entities for foreign investment using the VIE structure. For a more in-depth explanation of VIEs and associated risks, see U.S.-China Economic and Security Review Commission, 2019 Annual Report to Congress, November 2019, 176–177. https://www.uscc.gov/sites/default/files/2019- 11/Chapter%203%20Section%201%20-%20U.S.-China%20Commercial%20Relations.pdf.
† Following the release of these guidelines, SAMR fined 12 companies—including Tencent, Alibaba, and Baidu—the maximum penalty ($77,000) for failing to notify SAMR of previous mergers through VIEs. Reuters, “China Market Regulator Fines 12 Firms for Violating Anti-Monopoly Law,” March 11, 2021. https://www.reuters.com/article/us-china-anti-trust/china-market-regulator- fines-12-firms-for-violating-anti-monopoly-law-idUSKBN2B40EF.
‡ In 2016, Qihoo 360 went private from the Nasdaq after paying U.S. shareholders $9.3 billion in stock value. The company relisted on the Shanghai Stock Exchange in 2018 at a value of more than $60 billion. Former Qihoo 360 shareholders filed two lawsuits against the company in 2019, claiming they were misled about the company’s value. U.S.-China Economic and Security Review Commission, 2019 Annual Report to Congress, November 2019, 180. https://www.uscc.gov/sites/default/files/2019- 11/Chapter%203%20Section%201%20-%20U.S.-China%20Commercial%20Relations.pdf.
