Our Firm’s China-related practice constitutes the core business and “niche” of our legal services. Our clients range from large state-owned enterprises to small- and medium-sized private companies. The scope of our practice covers virtually all legal matters involved in U.S.-China transactions. Our Chinese-American lawyers, being fully aware of and familiar with Chinese culture, ensure our smooth and successful communication with our foreign clients, and our experienced American counterparts ensure our professionalism and the quality and range of skills needed to deal with cross-border transactions.
Antidumping, Countervailing Duties & Trade Remedies
The International Trade Commission (“ITC”) of the Department of Commerce is responsible for enforcing U.S. antidumping duty (“AD”) and countervailing duty (“CVD”) laws and determines whether a domestic industry is suffering material injury as a result of the imports of dumped or subsidized products. Foreign governments subsidize industries when they provide financial assistance to benefit the production, manufacture or exportation of goods. The ITC considers all relevant economic factors, including domestic industry’s output, sales, market share, employment and benefits.
U.S. trade remedies are highly regulated, for good reason, by the government because unfair foreign pricing and government subsidies distort the free flow of goods and adversely affect American business in the global marketplace. When a U.S. industry believes that it is being injured by unfair competition through dumping or subsidization of a foreign product, it may request the imposition of antidumping or countervailing duties.
Our Firm assists our clients in producing the necessary documents for the ITC procure a favorable AD or CVD order, which is issued upon the completion of their investigations. Petitions may be filed by a domestic interested party, including a manufacturer or a union within the domestic industry that competes with the imports to be investigated. AD and CVD remedies have been successfully pursued by a variety of domestic industries including producers of steel, industrial equipment, computer chips, agricultural products, textiles, chemicals and consumer products.
Our Firm has advised many companies on risks and opportunities relating to trade remedies in the context of corporate mergers and acquisitions and foreign direct investment activities. Our Firm’s attorneys have appeared before all of the regulatory agencies and courts, including, in the United States, the U.S. International Trade Commission, the Department of Commerce’s International Trade Administration, the Office of the U.S. Trade Representative, the U.S. Court of International Trade, the U.S. Court of Appeals for the Federal Circuit, and the U.S. Supreme Court.
Chinese Company Formation
We have extensive experience forming companies in China. Our attorneys are trained to provide legal services with an exceedingly important combination of American corporate legal knowledge and an understanding of China's corporate law, which ideally suits us to assist our overseas clients.
Registering a company in China is very different from registering a company in the United States or in Europe. Registering a company in China requires much more than filling out a few forms and paying a small fee; it requires the company to explain to the Chinese government exactly what its plans will be in China and to secure nearly all necessary approvals beforehand. Our attorneys are experienced in helping our clients navigate these difficult barriers, and although it is complicated and time-consuming to register a business in China, once we have successfully assisted our clients with registration, the newly formed companies are fully ready to conduct business.
Establishment of Foreign Invested Enterprises (“FIEs”)
We assist foreign clients in establishing and expanding their presence in China through establishing foreign invested enterprises (“FIEs”).
These can take a wide variety of legal forms depending on the client's needs, such as equity joint ventures, contractual joint ventures, wholly-owned foreign enterprises and sino-foreign or wholly-foreign-invested joint stock companies. We also assist many Chinese state-owned and private enterprises in attracting foreign investors and in cooperating with their foreign partners in the ongoing management of the enterprise.
The Firm maintains a particularly strong practice in the establishment of joint ventures. We regularly represent foreign and Chinese clients in a variety of foreign investment projects. We advise international companies intending to build their presence through acquiring existing businesses or forming joint ventures with Chinese partners. Over the years, we have represented multinationals in every field and industrial sector including; manufacturing, infrastructure, natural resources, and services amongst others.
We provide services to international and domestic clients throughout the life cycle of their investment projects in China. The services we provide include legal due diligence, design of project structure, establishment of various forms of foreign invested enterprises, asset or share purchases, tax advice, the drafting of project documents, and assistance in negotiations and approval processes. Through numerous joint venture projects, we have gained a rich wealth of experience in establishing joint ventures as well as identifying likely problem areas in operations and possible disputes.
Our clients value not only our advice on laws and regulations but also our practical recommendations on how to deal with the foreign or Chinese joint venture partner, the government and other stakeholders, as well as assisting in developing strategies as to how to tackle various problems and issues which may arise in a joint venture.
Ongoing Legal Advice to FIEs
We have established ongoing, long-term relationships as legal counsel for many of our clients in connection with their FIE matters. We provide daily legal support to clients in their operational activities, and also keep them informed about new legal developments that relate to their business and industry. We assist our clients in complying with their obligations pertaining to taxes, foreign exchange, labor, environmental concerns and customs. We pride ourselves on using a practical, problem-solving approach to addressing our clients’ needs. For many of our clients, we are no longer simply viewed as their legal counsel, but as valued members of their team, so much so that our attorneys have been invited to serve as directors or company secretaries to FIEs in China.
Cross-Border Mergers & Acquisitions
As China's economy becomes increasingly integrated with the world’s economy as a whole, corporate mergers and acquisitions (“M&A”) have become more popular with companies as a means to gain corporate presence in a new market.
Our Firm’s M&A practice incorporates our expertise of foreign direct investments, securities, taxes, intellectual property and employment law for the benefit of our clients. We pride ourselves in providing the utmost care in conducting due diligence, giving legal advice, negotiating and preparing legal documents for the acquisition and disposition of businesses and assets. We represent acquirers, target companies, financial advisors and major shareholders in a wide variety of industries and transactions.
The sale, liquidation or spinoff of a division or subsidiary presents a unique set of challenges that make them much more complex than typical merger integrations. Multiple parties with diverging agendas between the seller and buyer add a deeper layer of complexity to the deal structure. Our Firm is uniquely experienced in divestitures and our clients to focus on their core businesses while we establish an effective governance model, develop a divestiture roadmap and focus on day-one readiness to ensure a successful transaction.
As Chinese companies become more prominent on the global stage, strategic investments by foreign and domestic enterprises in those companies are becoming increasingly important. Our Firm works with clients to identify mutually beneficial opportunities and provides a full spectrum of legal support to safeguard and actualize the value of your investment.
Stock & Asset Acquisitions
A key focus at Dai & Associates is in the acquisitions of public and private companies. We are experienced in representing international and domestic companies in a variety of merger and acquisition transactions in manufacturing, servicing, infrastructure or other business sectors. In almost every merger and acquisition, the transactional services we provide include conducting due diligence investigations of the target acquisition, advising clients on legal issues relating to the laws of the People’s Republic of China (“PRC”), structuring entity formations, drafting legal documentation, among a variety of other legal services.
A corporate spin-off refers to a type of corporate action in which an entity “splits off” sections of its company as a separate business. Spin-offs and partial spin-offs have become increasingly common in China. In a "spin-off”, a parent company distributes shares of a subsidiary to the parent company's shareholders where the shares are usually distributed on a pro rata basis and the subsidiary becomes a separate company. An equity carve-out, sometimes called a “partial spin-off”, occurs when a parent company makes an initial public offering (“IPO”) for a minority stake of a wholly-owned subsidiary.
These transactions unlock the hidden value of one of the company's subsidiaries. Many of these transactions are motivated by the investors' desire for investment clarity in both the parent and the subsidiary. Our lawyers assist in not only complicated securities matters, but also with the structural considerations behind such transactions. Our goal is to provide expertise across different practice areas to ensure our clients receive maximum value.
Foreign Direct Investment (“FDI”)
Foreign direct investment (“FDI”) in China has boomed, both in value and in complexity. Burgeoning domestic markets, increasingly favorable regulations governing foreign investment and improving integration of China with the world economy are just a few examples to explain the growing abundance of opportunities for multinational firms. On the other hand, the pursuit of these opportunities is not without its pitfalls. China market entrants face a myriad of obstacles, ranging from cultural and language barriers to lingering questions regarding structuring, control and the protection of intellectual property rights.
Our China-Related Practice has a history of successfully representing multinational entities with their FDI and acquisition projects in China. We offer a full range of relevant legal strengths in corporate, finance, intellectual property, government approvals, labor and employment, and tax law. Our experience reconciling relevant U.S. and Chinese legal practices affords our clients cutting edge insights into what will and will not work in the China market.
International Regulatory Compliance
Our Firm assists many multinationals with extensive interests in China on U.S. and Chinese regulatory compliance issues. Our Firm also provides legal advice on specific activities and transactions, helps companies structure and document specific relationships, performs due diligence on entities and conducts internal investigations. We offer a full range of counseling, compliance and advocacy services for companies involved in international transactions that implicate U.S. or international regulatory requirements. We assist clients on matters involving export controls for dual-use goods, technology and defense articles, and economic sanctions, international competition and regulatory issues associated with cross-border joint ventures, mergers and licensing agreements.
Project Development & Finance
Dai & Associates is well known for its ability to finance large-scale infrastructure projects. Our attorneys excel at initiating projects, closing transactions, and anticipating and avoiding pitfalls during project development. We provide legal advice on the use of project financing techniques for infrastructure and capital intensive projects.
Domestic companies in China are seeking to become large, global competitors and enter foreign markets. We help our foreign clients achieve their goals of U.S. expansion. We advise them not just on the legal complexities of these development project, but we also give them cultural and political guidance in navigating the Chinese market. For the successful completion of such projects, our clients must be culturally versed and have industry experience with their new business ventures.
We have a long and distinguished record of counseling all types of clients, including sponsors, project companies, lenders, private commercial and investment banks, placement agents, underwriters, export credit agencies, multilateral lending institutions, suppliers, contractors, off-take purchasers and advisors. With our multinational experience and multilingual abilities, we can meet the demands of complicated transactions. Our legal service include but are not limited to:
- Initial development and financing of a project;
- Restructuring and refinancing of projects;
- Project mergers, acquisitions and dispositions;
- Sovereign and project restructurings, political risk insurance and other novel split-risk arrangements, as well as experience with export credit agencies and multilateral lending institutions; and
- Dispute resolution as it relates to projects.
Technology, Media and Intellectual Property
As technology markets continue to evolve, traditional geographic and business sector boundaries are being rendered obsolete. Nowhere is this more true than in China.
We counsel a variety of high-technology, media, and entertainment companies on their legal matters in China. Our clients rely on our ability to synthesize multi-jurisdictional issues relating to intellectual property, employment, and corporate law, as well as non-corporate issues specific to China, such as government incentives for high-technology projects and special regulatory regimes and intellectual property protection measures. From intellectual property-heavy cross-border acquisitions to technology joint ventures and strategic alliances to global licensing agreements, Dai & Associates’ Technology and Intellectual Property Practice offers an unparalleled depth and breadth of legal knowledge to clients seeking to exploit technology-related opportunities in China.
U.S. Capital Market--IPO and APO
To many business owners, going public represents a financial milestone: it is public recognition of their corporate success. It also can be highly profitable. However, the public sale of securities, especially in the U.S. public market, is an expensive process that can subject the company and its owners to liabilities well in excess of the amounts of securities sold, particularly if the sale is poorly planned and supervised. In some cases, it also can add pressures and costs to a company without contributing to the success of a business or its owners. Dai & Associates could help Chinese companies in IPO transactions and successfully gain access to U.S. capital markets without the above risks.
We represent many public companies and companies seeking to access public markets in initial public offerings (IPOs) and/or the increasingly more common structures. When representing issuers, we typically become involved in all aspects of corporate and business planning and structuring, including preparation of registration statements and prospectuses, assistance in negotiating underwriting and placement arrangements, preparation of listing applications on NYSE, AMEX and NASDAQ in the U.S. and related transactional aspects of the offerings. We also have extensive experience representing investment banks, placement agents and investors.
Our representation does not end at the completion of an IPO, however. In concert with our company representation practice, we routinely advise companies on periodic reporting requirements, securities regulations and other matters that are critical to our clients during and after the IPO process. We offer public companies one of the most experienced and respected corporate practice teams in the world. Our team regularly handles a myriad of issues, especially in areas such as corporate and securities, tax, mergers and acquisitions intellectual property, antitrust and competition, employee benefits and environmental law.
Lacking from the options currently available to most growth-stage Chinese companies is effective access to public finance. Unlike the United States, these companies are shut off from access to their local public markets. Fortunately a solution exists in the form of an alternative public offering (APO). An APO is an alternative form of listing that allows companies in emerging markets to gain access to the deepest and most liquid capital market in the world. APO is the combination of a reverse merger with a simultaneous private investment of public equity (PIPE). It allows companies an alternative to an initial public offering (IPO) as a means of going public while raising capital. In an APO, the transaction allows a company’s stock to be publicly traded following a merger or similar transaction with a publicly held shell company, whereby the equity owners of the private company typically take control of the former shell company. The difference of “alternative” aspect of the transaction involves the mechanism used to affect the listing. Whereas in a traditional IPO, a company engages an investment banker to organize and manage a flotation of the company’s stock, in an APO the company merges with a “listing vehicle” that provides the initial public shares and qualifications.
Alternative public offerings (APOs) have been around for over a decade in one form or another, but their development has been particularly interesting since the financial crisis broke. In the new market environment, we expect the APO to be more widely accepted as a viable alternative to traditional IPOs, especially among small to mid-tier companies seeking access to U.S. capital markets and companies from foreign emerging markets that need to establish a Western presence and Western style practices before being positioned to attract more traditional institutional investors.
APO is one of the exciting ways Dai & Associates’ attorneys can help Chinese companies go public. We help prepare companies to make the significant transition to the public domain by providing detailed, step-by-step guidance to management and to the boards of directors. We maintain a very strong working relationship with the Securities and Exchange Commission, which enables us to take clients effectively and efficiently through the regulatory review process in the United States.