Are there any restrictions on the ownership of shares in Chinese companies?

Yes, there are restrictions on the ownership of shares in Chinese companies. In Pennsylvania, companies which are based in China and which are registered to do business in the state must adhere to the China Business Ventures Law. This law specifies that no more than 25 percent of the shares of a company registered in the state can be owned by non-Chinese individuals or entities. This restriction applies to any foreign ownership regardless of the country of origin. Additionally, the law specifies that no more than 25 percent of a company’s shares can be owned by entities which are affiliates of, or are related to, a Chinese company. In order for a foreign entity or individual to be able to own more than 25 percent of a Chinese-based company, they must be able to demonstrate that they are qualified to invest in the company. This must be done to the satisfaction of the Chinese government before the foreign entity or individual can own more than a 25 percent stake. Finally, the China Business Ventures Law also requires that any foreign entity or individual that does own a 25 percent or greater share of a Chinese business must disclose their ownership status to the Pennsylvania Department of State. This must be done within 10 days of becoming an owner of the company.

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Are there any restrictions on the ownership of shares in Chinese companies?

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