Jack Li Partner, Beijing Office Fangda Partners in multi-jurisdictions, capable of speaking both English and German, and experienced in EU-China M&A transactions. It enables us to bridge legal, regulatory, language and cultural differences that the client inevitably faces in this transaction. Did you encounter any significant challenges during the course of this acquisition? If so, how did you overcome them? Cross-border transactions can be among the most complex and challenging to execute. In the past three years, we have further seen a remarkable increase of challenges due to a number of factors, including the COVID-19 pandemic, geopolitical risks and intensive changes in law. Transactions have longer time to complete, more negotiations use video or call conferences instead of face-to-face communications and there is a higher risk in deal uncertainty for high-profile transactions. Due to confidentiality, we cannot disclose the details of the transaction. Here are certain general insights into recent crossborder transactions involving Chinese purchasers: 1) Political and regulatory considerations. The PRC ODI filings or approvals may be politicised if certain negative diplomatic events happen between China and the country where the target is located. However, the ODI related PRC authorities will not disclose further information to the applicants under this scenario. The PRC counsel of the international seller needs to be sensitive enough and experienced in dealing with this situation and advise the client different routes and ’Plan B’s to complete the transaction or mitigate the costs. 2) Compliance Issues. The Chinese SOEs have been facing expanded scrutiny by the PRC government in recent years. In order to act in compliance with new laws and higher internal requirements, the PRC purchaser, normally a subsidiary of an SOE, needs to go 82 LAWYER MONTHLY AUGUST 2023
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