Since Sina Corp first went public using the VIE structure on New York’s Nasdaq in 2000, hundreds of Chinese firms have taken the same path. Photo: Bloomberg
Legally ambiguous ‘VIE’ structure means foreign investors don’t technically own overseas-listed Chinese stocks – and that could spell disaster
- To skirt China’s restrictions on foreign investment in certain industries, many firms adopt a complex VIE structure which falls into a legal grey area
- Beijing has so far remained silent on the subject, but if it decided to clamp down, the effects would be devastating
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Since Sina Corp first went public using the VIE structure on New York’s Nasdaq in 2000, hundreds of Chinese firms have taken the same path. Photo: Bloomberg