The Possibility of Using Variable Interest Entities Structure to Marine Industry in China
Abstract:
Over the last several years, China’s marine industry as well as variable interest entity (VIE) structure are very hot topics. However, there are few people talking about its possible integration and the benefits to be gained by integrating them. This article is to illustrate that the VIE structure can be utilized as an effective way for Chinese marine industrial firms to sidestep restrictions on foreign ownership and international capital markets entry, as well as generating new ways to acquire advanced technologies. By signing contracts instead of holding any eq uity interest, the establishment of VIE can surmount some of the obstacles related to a lack of foreign investment opportunities, restricted access to capital, and technological shortcomings. Particular focus will be given to how it supports major industries such as China’s marine industry with foreign cooperation and financing opportu nities, thus promoting growth and innovation. In conclusion, it is illustrated that VIE might act as an important mechanism to assist with financing and technology issues for China’s Marine industry development, while further analysis finds out problems and difficulties it faces.
