Gregory Puff, Tatman Savio Interviewed by Metro Corp Counsel on Doing Business in China

Metropolitan Corporate Counsel interviewed Akin Gump Asia practice head and Hong Kong partner in charge Gregory Puff and Tatman Savio, a partner in Akin Gump’s international trade practice and a registered foreign lawyer in the firm’s Hong Kong office, for a feature article “The Many Challenges of Doing Business in China: Opportunities abound – as do regulatory and compliance risks.”

The article touches on topics such as China’s regulatory infrastructure, going-private transactions, areas of investor interest and PRC anticorruption laws.

Among their observations:

  • On China’s Foreign Investment Law: “One the one hand, AmCham China, the U.S. Chamber of Commerce and many foreign companies have cautiously welcomed the draft law, which would replace a framework of disparate laws currently governing foreign investment, market access and the national security review process, and potentially open up certain sectors of China’s economy and bring more transparency and predictability to the investment process. On the other hand, the breadth of the national security review power has raised concerns about China’s potential to block foreign investment for reasons that do not approximate traditional definitions of national security.”
  • On state-owned enterprises driving M&A: “M&A activity in 2015, and maybe also in 2014, feels slower than it was in 2012 and 2013. It’s less speculative in nature and more of a common-sense corporate activity that involves the SOE identifying sensible businesses or assets to purchase and the jurisdictions where they can be best utilized... There’s also a trend of SOEs building platforms as a springboard for outbound activity, particularly in the banking industry, where you see important platforms in Hong Kong but also elsewhere.”
  • On the U.S. CFIUS (Committee on Foreign Investment in the United States) process: “Chinese investors have become increasingly savvy in considering the CFIUS process in their transaction planning. Even in the preliminary phases, they are thinking about ways in which the U.S. government might perceive a particular investment and evaluating targets in terms of whether they are in sensitive sectors of the U.S. economy. They are also looking at ways to mitigate U.S. government concerns regarding certain elements of the transaction that could invoke scrutiny, such as by appointing a certain number of U.S. persons to the company’s board or spinning off parts of the company that have significant U.S. government contracts or that deal with sensitive technologies.”

To read the full interview, please click here.