Why do you need to do overseas investment filing?
ODI refers to the act of owning a non-financial enterprise or obtaining the ownership, control, operation and management rights and other rights and interests of an existing non-financial enterprise by an enterprise established in accordance with the law in the territory of the People's Republic of China (hereinafter referred to as the enterprise) through new establishment, mergers and acquisitions and other means. The full name is the People's Republic of China Overseas Investment Record.
In layman's terms, overseas investment filing means that when our domestic enterprises invest in overseas enterprises, whether it is a new company, a new project or an equity merger or acquisition, as long as it involves directly or indirectly obtaining the ownership, control, operation and management of the overseas company, it needs to carry out overseas investment filing (ODI). It is equivalent to the "ID card" of an enterprise's overseas investment, and it is only after filing that it can legally and compliantly carry out overseas investment.
Note: The secondary investment activities carried out by overseas enterprises are not within the scope of outbound investment management and do not need to be reviewed by the relevant departments.
Consequences of not applying for an ODI filing:
1. After the completion of the filing of the restriction on the entry and exit of funds, the enterprise can realize the entry and exit of funds in a legal and compliant manner, otherwise the funds will not be able to be legally remitted through the bank, and the return of profits and dividends of overseas entities will also be restricted in the future, and penalties such as high fines will be imposed.
2. Unable to complete the return investmentIf the overseas subsidiary of the domestic enterprise intends to make a return investment in the mainland enterprise, it will not be able to complete the return investment if it does not go through the ODI filing procedures, which requires special attention for enterprises with overseas listing plans in the future.
3. Unable to enjoy the best subsidies and incentivesIf the ODI filing procedures have not been completed, domestic enterprises cannot enjoy the relevant subsidies and incentives in China, including overseas intellectual property disputes and "two anti-one guarantee" response subsidies.
4. Disciplinary measures. If an overseas investment is made without completing the ODI filing, the domestic entity will be prohibited from any overseas investment within a certain period of time. The relevant competent authorities have the right to order the domestic entity to suspend or stop the implementation of the project and make corrections within a time limit, and to impose a warning on the domestic entity and the relevant responsible persons;where a crime is constituted, criminal responsibility is pursued in accordance with law.