Asia

JAPANESE UPDATE – Letters Of Intent In Japanese M&A Transactions

Highlights: A letter of intent is especially helpful in a cross-border transaction to memorialize the basic terms of a proposed deal when differences in culture, deal structuring techniques, due diligence styles, and documentation standards can add layers of challenge. Typical provisions in a letter of intent are discussed below. The default rule under Japanese law … Continued

Editors’ Note: Masakazu Iwakura is a Senior Partner at Nishimura & Asahi and a member of XBMA's Legal Roundtable. This paper was co-authored Stephen D. Bohrer, Foreign Law Partner, and Daisuke Morimoto, Partner, of Nishimura & Asahi. As one of Japan's leading M&A practitioners, Masakazu Iwakura has handled a variety of groundbreaking M&A transactions and serves on the boards of several public companies: COOKPAD Corporation, Imperial Hotel and GMO Internet. Mr. Iwakura is also a Professor at Hitotsubashi University Graduate School of International Corporate Strategy and is a Visiting Professor of Law at Harvard Law School in the 2013-2014 academic year.

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CHINESE UPDATE – Shanghai Free Trade Zone – Still Much to Expect

Highlights:  The highly anticipated China (Shanghai) Pilot Free Trade Zone (the “Zone”) was officially launched on September 27, 2013, followed by a flurry of implementing rules and measures.  The central government of China expects the Zone to be the country’s testing ground for groundbreaking economic reforms to be extended nationwide in the future.  The most … Continued

Editors’ Note: Contributed by Adam Li (Li, Qi), a partner at Jun He and a member of XBMA’s Legal Roundtable. Mr. Li is a leading expert in international M&A, capital market and international financial transactions involving Chinese companies. He has broad experience with VIEs and other structures for foreign investment in China. Authored by Daniel He (He, Kan), a partner of Jun He Law Offices, and Cui, Yu, an associate of Jun He Law Offices. Mr. He is a partner at Jun He, specialized in mergers and acquisitions, foreign direct investment, general corporate law, and regulatory compliance.

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JAPANESE UPDATE – Progress of the M&A transaction practice in Japan under the New Business Combination Investigation Procedures of the Antimonopoly Act

Highlights: Since the implementation of the Japan Fair Trade Commission’s business combination investigation procedures, two large mergers have passed anti-trust approval: SMI’s merger into NCS to form the largest steel company in Japan and second largest in the world, and the merger of the TSE Group and the OSE, Japan’s two largest financial instrument exchanges.  … Continued

Editors’ Note:  Masakazu Iwakura is a Senior Partner at Nishimura & Asahi and a member of XBMA's Legal Roundtable. This paper was co-authored with Kenta Ogata, an associate of Nishimura & Asahi. As one of Japan's leading M&A practitioners, Masakazu Iwakura has handled a variety of groundbreaking M&A transactions and serves on the boards of several public companies: COOKPAD Corporation, Imperial Hotel and GMO Internet. Mr. Iwakura is also a Professor at Hitotsubashi University Graduate School of International Corporate Strategy and will be teaching at Harvard Law School in 2013-2014 as a Visiting Professor.

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INDIAN UPDATE – The Competition Commission of India’s Approach to Penalties: The Need for Guidelines

Highlights:  Recently, the Competition Commission of India (“CCI”) has been imposing significant penalties in the range of 5% to 10% of the turnover of enterprises violating India’s Competition Act, 2002.  In one cartel case, CCI imposed a penalty equivalent to 50% of the profits made by the concerned enterprises. CCI’s increasing penchant for imposing significant … Continued

Editors’ Note:  This is contributed by Zia Mody, founding partner of AZB & Partners and a member of XBMA’s Legal Roundtable.  Ms. Mody has led many of India’s most significant corporate transactions, been recognized by Business Today as one of the Most Powerful Women in Indian Business and received the Economic Times Award for Corporate Excellence as Businesswoman of the Year.

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INDIA UPDATE – The India Board Report 2011: Board Composition, Effectiveness and Best Practices

Highlights:  Along with the global economic and financial crisis, a string of frauds resulted in the introduction of stricter corporate governance mechanisms in India, with additional requirements, including in the pending Companies Bill, under consideration. While these changes were expected to plug new holes found in the existing regulations, there was also growing realization that … Continued

Editors’ Note:  This third edition of the India Board Report is contributed by Zia Mody, founding partner of AZB & Partners and a member of XBMA’s Legal Roundtable.  Ms. Mody has led many of India’s most significant corporate transactions, been recognized by Business Today as one of the Most Powerful Women in Indian Business and received the Economic Times Award for Corporate Excellence as Businesswoman of the Year. 

The India Board Report, jointly prepared by AZB & Partners, Hunt Partners, and PWC, comprehensively surveys hundreds of leading Indian companies and independent directors on the timely topics of Board Composition, Effectiveness and Best Practices.

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INDIAN UPDATE – Trends in Merger Control (2012 Edition)

Executive summary: The following article Trends in Merger Control analyses the principles and trends enunciated by the Competition Commission of India (“CCI”) in the merger control orders passed to date. Introduction: Legal Framework The merger control regime in India is governed by the provisions of the Competition Act, 2002 (“Act”) along with the Competition Commission … Continued

Editors’ Note:  Cyril Shroff is a member of XBMA’s Legal Roundtable and one of the deans of the Indian corporate bar and a leading authority on Indian M&A, with extensive experience handling many of the largest and most complex domestic and cross-border M&A, takeover, banking and project finance transactions in India.

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JAPANESE UPDATE – A Step Towards Easing Restrictions on Use of Exchange Offers by Japanese Companies Making Foreign Acquisitions

Executive Summary/Highlights:  Japanese legal hurdles to cross-border exchange offers or triangular mergers have deterred Japanese acquirers from using their stock in cross-border acquisitions. A recent amendment to the Law on Special Measures for Industrial Revitalization and Innovation, which took effect on July 1, 2011, introduces a new path to facilitate exchange offers by Japanese firms … Continued

Editors’ Note:  This paper was authored by Akemi Suzuki, a partner at Nagashima Ohno & Tsunematsu who concentrates on domestic and cross-border mergers and acquisitions in theU.S., Asia andEurope.  Shuji Yanase is a former chairman of Nagashima Ohno & Tsunematsu and a member of XBMA’s Legal Roundtable, with more than thirty years of leadership in international M&A transactions involving Japanese firms.

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KOREAN UPDATE – Amendments to the Korean Commercial Code To Have Far-Reaching Implications for Korean M&A and Corporate Governance

Executive Summary/Highlights: The recently amended Korean Commercial Code (“KCC”), which will become effective April 15, 2012, includes an array of provisions that aim for more flexibility and transparency in corporate management, such as by introducing new forms of business entities and diverse types of stock, relaxing restrictions on dividend payments, and prohibiting the appropriation of … Continued

Editors’ Note:  Sang-Yeol Park is a partner at Kim & Chang and member of the XBMA Legal Roundtable.  Mr. Park is one of Korea’s leading corporate law practitioners, with broad expertise in mergers and acquisitions and cross-border transactions and extensive experience advising multinational and Korean companies on industrial projects.

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CHINESE UPDATE – The Most Recent Challenges to the VIE Structure for Foreign Investment in China

Executive Summary/Highlights: Reuters reported on Sept. 18, 2011 that CSRC, the Chinese securities market regulatory watchdog, submitted a report urging the State Council to “clamp down” on  the VIE structures employed in thousands of investments by foreigners into domestic Chinese companies. The VIE structure was adopted to gain access to the sectors where China had … Continued

Editors’ Note:  Adam Li (Li Qi) is a partner at Jun He and a member of XBMA’s Legal Roundtable.  Mr. Li is a leading expert in international M&A, capital market and international financial transactions involving Chinese companies. He has broad experience with VIEs and other structures for foreign investment in China.  This paper provides a second perspective on the challenge to the VIE structure discussed in Ms. Xu Ping’s recent paper.

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CHINESE UPDATE – Variable Interest Entity (VIE) Structure for Foreign Investment in the PRC May Face Challenge

Executive Summary/Highlights: The VIE structure (i.e. reliance upon contractual arrangements to control a PRC operating company) has been a popular structure in the last decade for both foreign and Chinese investors alike. A number of recent cases involving companies using a VIE structure have exposed the inherent defects and potential legal and regulatory risks inherent … Continued

Editors’ Note:  Xu Ping is a partner at King & Wood and a member of XBMA’s Legal Roundtable. Ms. Xu heads King & Wood’s corporate practice and is a leading expert in representing international companies in their investments in China, with extensive experience in structuring foreign direct investment, M&A and technology transfer transactions.

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