Challenges in cross-border investment and financing

Chinese enterprises going global is a growing trend, and at CBLJ Forum 2019, Dentons China moderated a discussion on “Legal challenges for companies in cross-border investment and financing”.

Emilia Shi, a senior partner at Dentons, pointed out that Chinese companies should make an estimate about how long it would take to obtain approval from the central government when engaging in cross-border mergers. She also added that the US and Europe had strengthened their examinations of foreign investment.

Wu Siying, senior consultant at Dentons, was of the opinion that cross-border mergers by Chinese enterprises would continue to boom. He said the role of lawyers should be providing more detailed and up-to-date information to clients, and helping them to make more accurate judgments. And he said lawyers should also assist clients in navigating barriers and difficulties after they had made their decisions.

Zheng Kai, managing director, Corporate Finance and Capital Markets at CLSA, noted that the majority of enterprises that went global used to be state-owned enterprises (SOEs), but now private enterprises and SOEs shared this equally. He also said that Chinese enterprises tended to conduct overseas project financing through a financing group made up of Chinese-funded investment banks and local financial institutions to ensure the long-term stability of making investments locally.