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O’Melveny’s Qiang Li Quoted in China Law & Practice on Stricter Acquisitions Rules in China

February 24, 2012

O’Melveny & Myers LLP Shanghai managing partner Qiang Li was quoted in the February 24, 2012, China Law & Practice article “Stricter Rules on Acquisitions Released,” on the Chinese Securities and Regulatory Commission (CSRC)’s recent minor amendments to article 62 and 63. According to a CSRC official, the amendments aim to “reduce price volatility and enhance the fairness of trade.” However, Li told China Law & Practice “It does not change the acquisition process a single bit – the CSRC’s intention is to protect small shareholders and investors falling in line with their policy.” Li added “that the CSRC has some momentum and they are starting with small steps, but ultimately it is the high-end investors that dominate China’s capital markets.”

 

Additionally, the amended article proposes an expert advisory committee to assist listed company acquisitions with providing advice, accounting, and asset appraisal. Of the committee, Li said, “This is an encouraging and positive step from the CSRC. The committee allows professionals to voice their opinions and this is a trend we are seeing more of, especially in progressive cities like Shanghai. He added “that the big picture with capital markets in China is that the government always has the final say, but this committee will allow professionals firms to add value. If this committee trend continues “it could reduce the government’s role in approving acquisitions and signals a move towards a more disclosure- based system, where professionals play a larger role than the government.”