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Doing Business in China via the Cayman Islands (2006 Update)
Many companies doing business in China are using a structure that includes a company formed under the laws of the Cayman Islands (CI). Chinese technology and Internet companies listed on NASDAQ ' such as Actions Semiconductor, Baidu, CTrip, China Medical Technologies, Focus Media, Shanda, Suntech Power and Tom Online ' are actually CI companies. The primary business reasons for an offshore structure are flexibility in an exit strategy, whether in connection with an initial public offering (IPO) or an acquisition; the possibility of reducing U.S. taxes; and reducing the impact of China's currency exchange restrictions.
In the simplest form, the structure is a CI company with a China subsidiary. Investments are made in the CI company and the subsidiary is the operating company. The next simplest form is when the CI company is the parent company of two subsidiary corporations ' one in China and the other in the U.S. A U.S. corporation is needed only if the U.S. is a market for the business. The most complex structure is required when the China business is in a restricted industry such as an Internet business (see, “Investment and Operating in Restricted Industries in China,” www.fenwick.com/docstore/Publications/Corporate/Invest_Operating_In_China.pdf.) Other variations include delaying the formation of a U.S. subsidiary until or if U.S. operations are needed and adding a company from a jurisdiction having a tax treaty with China (such as Mauritius) between the CI and Chinese corporations. Global venture capitalists have become comfortable with these CI structures and many U.S. venture capitalists also understand and use these structures.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
How AI Has Affected PR
When we consider how the use of AI affects legal PR and communications, we have to look at it as an industrywide global phenomenon. A recent online conference provided an overview of the latest AI trends in public relations, and specifically, the impact of AI on communications. Here are some of the key points and takeaways from several of the speakers, who provided current best practices, tips, concerns and case studies.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.