ODI Overseas Investment 100 Q&A

1、 Applicable scope

（1） What policy documents should enterprises mainly refer to when conducting overseas investments?

Answer: At the level of the State Council, please refer to the "Notice of the General Office of the State Council on Forwarding the Guiding Opinions of the National Development and Reform Commission, Ministry of Commerce, People's Bank of China, and Ministry of Foreign Affairs on Further Guiding and Regulating the Direction of Overseas Investment" (State Council Office [2017] No. 74). At the level of the National Development and Reform Commission, please refer to the "Management Measures for Overseas Investment of Enterprises" (National Development and Reform Commission Order No. 11) and the "Supporting Format Text of the National Development and Reform Commission on Issuing the Management Measures for Overseas Investment of Enterprises" (2018)

The Notice on the Release of the Catalogue of Sensitive Industries for Overseas Investment (2018 Edition) (NDRC Foreign Investment [2018] No. 252) and the Notice of the National Development and Reform Commission on the Release of the Catalogue of Sensitive Industries for Overseas Investment (2018 Edition) (NDRC Foreign Investment [2018] No. 251), etc. At the level of other departments, please consult the corresponding department.

（2） What types of investment activities belong to the overseas investment referred to in the Measures for the Administration of Overseas Investment by Enterprises (Order No. 11 of the National Development and Reform Commission, hereinafter referred to as Order No. 11)?

Answer: According to Article 2 of Order No. 11, overseas investment refers to the investment activities of enterprises within the territory of the People's Republic of China (hereinafter referred to as investment entities) directly or through overseas enterprises controlled by them, obtaining overseas ownership, control, management and other related rights and interests by investing assets, equity, or providing financing, guarantees, etc. Investment activities mainly include but are not limited to the following situations:

1. Obtain ownership, usage rights, and other rights of overseas land;

2. Obtaining rights and interests in overseas natural resource exploration and development concessions;

3. Obtain ownership and management rights of overseas infrastructure;

4. Obtain ownership and management rights of overseas enterprises or assets;

5. New construction or expansion of overseas fixed assets;

6. Establish new overseas enterprises or increase investment in existing overseas enterprises;

7. Establishing or participating in overseas equity investment funds;

8. Control overseas enterprises or assets through agreements, trusts, and other means.

The enterprises referred to in Order No. 11 include various types of non-financial enterprises and financial enterprises.

The control referred to in Order No. 11 refers to the direct or indirect ownership of half of a company's assets

Having the right to vote or, although not holding more than half of the voting rights, being able to control important matters such as the operation, finance, personnel, and technology of the enterprise.

（3） What is the scope of "assets, equity" in Article 2 of Order No. 11, which states "investing assets, equity or providing financing, guarantees, etc."?

Answer: The "assets and rights" in Order No. 11 include various types of assets and rights such as currency, securities, physical goods, technology, intellectual property, equity, and debt.

（4） What types of overseas investment projects require approval? What types of overseas investment projects need to be applied for filing?

Answer: According to Article 13 and Article 14 of Order No. 11, the scope of approval management is sensitive projects carried out directly or through overseas enterprises controlled by the investment entity. The scope of implementing filing management refers to non sensitive projects directly carried out by investment entities, that is, non sensitive projects in which investment entities directly invest assets, equity, or provide financing and guarantees.

The sensitive projects referred to in Order No. 11 include projects involving sensitive countries and regions; Projects involving sensitive industries.

Sensitive countries and regions include: countries and regions that have not established diplomatic relations with China; Countries and regions experiencing war or internal strife; According to international treaties, agreements, etc. that China has signed or participated in, it is necessary to restrict the countries and regions in which enterprises can invest; Other sensitive countries and regions.

Sensitive industries include the development, production, and maintenance of weapons and equipment; Cross border water resource development and utilization; News media; According to the Notice of the General Office of the State Council on Forwarding the Guiding Opinions of the National Development and Reform Commission, the Ministry of Commerce, the People's Bank of China, and the Ministry of Foreign Affairs on Further Guiding and Regulating the Direction of Overseas Investment (State Council Office [2017])

74), industries that require restrictions on overseas investment by enterprises: real estate, hotels, cinemas, entertainment, sports clubs, equity investment funds or investment platforms established overseas without specific industrial projects.

（5） In Order No. 11, "overseas investment directly carried out by domestic enterprises" refers to the form of overseas investment carried out by investment entities?

Answer: In Order No. 11, "overseas investment directly carried out by domestic enterprises" refers to overseas investment in which domestic investment entities directly invest assets, equity, or provide financing and guarantees. For example, domestic enterprise A directly builds or acquires overseas enterprise B; Domestic enterprise A injects assets and equity into overseas subsidiary A or provides financing guarantees for A, and A builds or acquires overseas enterprise B.

（6） Order No. 11 includes overseas investments conducted by "investment entities through overseas enterprises under their control" in the scope of supervision and services. At which level should "overseas enterprises controlled by investment entities" penetrate?

Answer: The "overseas enterprises controlled by investment entities" referred to in Order No. 11 should be traced layer by layer in accordance with the regulatory principle of substance over form, penetrating all overseas enterprises whose ultimate actual controller is a domestic investment entity.

（7） Do investors need to apply to the development and reform department for approval and filing of overseas investment projects if they do not directly invest in assets, equity, or provide financing or guarantees, but instead conduct overseas investments through overseas enterprises they control?

Answer: Investment entities conducting sensitive overseas investments through overseas enterprises they control need to apply for project approval from the National Development and Reform Commission. Overseas enterprises controlled by the investment entity carry out non sensitive overseas investment projects, and the investment entity does not directly invest in assets, equity, or provide financing or guarantees. For projects with a Chinese investment amount of over 300 million US dollars, the investment entity needs to submit to the state

The Development and Reform Commission does not need to apply for project approval or filing when submitting a report on large-scale non sensitive projects, and projects with Chinese investment of less than 300 million US dollars do not need to go through relevant procedures.

（8） Is investing in Hong Kong, Macao, and Taiwan a form of overseas investment?

Answer: According to Article 62 of Order No. 11, if the investment entity directly or through its controlled enterprises conducts investments in Hong Kong, Macao, and Taiwan, it shall be executed in accordance with Order No. 11; If the investment entity conducts investments overseas through its controlled enterprises in Hong Kong, Macau, and Taiwan, it shall follow the implementation of Order No. 11.

（9） Is Order No. 11 applicable to domestic natural persons establishing enterprises or conducting other overseas investment projects overseas?

Answer: According to Article 63 of Order 11, direct investment by domestic natural persons overseas is not subject to Order 11. If domestic natural persons invest overseas through overseas enterprises controlled by them or enterprises in Hong Kong, Macao, and Taiwan, they shall follow Order 11 for implementation.

（10） Does the term "domestic natural person" referred to in Order No. 11 refer to a natural person who holds Chinese nationality?

Answer: The term "domestic natural persons" referred to in Order No. 11 refers to domestic natural persons who hold the nationality of the People's Republic of China.

（11） The main asset b of overseas enterprise B is located within China, and domestic enterprise A directly acquires overseas enterprise B to obtain domestic asset b. Does this type of situation belong to the overseas investment referred to in Order No. 11?

Answer: According to Article 2 of Order No. 11, the acquisition of relevant rights and interests of overseas enterprise B by domestic enterprise A through the acquisition of overseas enterprise B belongs to the overseas investment referred to in Order No. 11.

（12） Domestic enterprise A intends to acquire domestic foreign-funded enterprise B and pay the acquisition funds to B's overseas shareholder B. Does this type of situation belong to the overseas investment referred to in Order No. 11?

Answer: If domestic enterprise A acquires domestic foreign-funded enterprise B without engaging in investment activities as stipulated in Article 2 of Order No. 11, such situations do not belong to the overseas investment referred to in Order No. 11.

（13） Domestic enterprise A plans to acquire its controlled overseas enterprise B from domestic enterprise B, and the transaction funds are planned to be paid domestically. Is the above-mentioned investment activity subject to Order 11?

Answer: The acquisition of overseas enterprise b controlled by domestic enterprise A from domestic enterprise B belongs to the overseas investment mentioned in Article 2 of Order 11, and is subject to Order 11.

（14） Domestic enterprise A plans to acquire its overseas enterprise B from overseas enterprise B, with the funding source being its own funds overseas and not involving cross-border capital flows. Is Order 11 applicable to this type of situation?

Answer: Domestic enterprise A acquires foreign enterprise B and holds foreign enterprise B. The acquisition funds are paid by A's own funds overseas, and do not involve cross-border capital flow. In the above situation, domestic enterprise A invested in asset equity and obtained ownership of overseas asset B, and is subject to Order 11.

（15） The overseas enterprise A controlled by domestic enterprise A plans to issue bonds overseas, and A plans to provide guarantees for A's bond issuance behavior. Is Order 11 applicable to this type of situation?

Answer: Overseas enterprise A controlled by domestic enterprise A issues bonds overseas, and A provides guarantees for a's bond issuance behavior. If the funds raised through bond issuance plan to carry out overseas investments as stipulated in Article 2 of Order No. 11, Order No. 11 shall apply. If the funds raised through bond issuance are not used for overseas investment as stipulated in Order No. 11, Order No. 11 shall not apply.

（16） Is the 11th order applicable to domestic insurance companies planning to remit insurance funds overseas?

Answer: If domestic insurance companies plan to use insurance funds to carry out overseas investments as stipulated in Article 2 of Order No. 11, Order No. 11 shall apply. If domestic insurance companies do not engage in overseas investment as stipulated in Article 2 of Order No. 11, Order No. 11 shall not apply.

（17） Do domestic enterprises provide guarantees for overseas subsidiaries to provide financing to banks, and the use of financing funds by overseas subsidiaries does not involve overseas investment activities as stipulated in Article 2 of Order 11? Do these situations require the completion of overseas investment project filing or approval procedures?

Answer: If domestic enterprises provide financing guarantees for overseas subsidiaries and the funds are not used to carry out overseas investments as stipulated in Article 2 of Order No. 11, Order No. 11 is not applicable and there is no need to apply for approval or filing with the Development and Reform Commission department. If domestic enterprises provide financing funds as guarantees for overseas subsidiaries to carry out overseas investments as stipulated in Article 2 of Order No. 11, Order No. 11 shall apply and require approval and filing with the development and reform department.

（18） Do domestic foreign-invested enterprises need to complete relevant procedures in accordance with the relevant provisions of Order No. 11 when conducting overseas investments?

Answer: Yes.

（19） Order No. 11 shall come into effect on March 1, 2018, and the Measures for the Administration of Approval and Filing of Overseas Investment Projects (referred to as Order No. 9) shall be abolished simultaneously. Is it necessary to apply for approval, filing, reporting and other procedures in accordance with the relevant provisions of Order No. 11 for investment activities implemented by enterprises before March 1, 2018, which do not require approval or filing procedures in accordance with the then effective Order No. 9?

Answer: No need to apply for a replacement.

（20） Domestic enterprise A intends to provide financing or guarantees for the investment of its overseas parent company B overseas. Domestic enterprise A does not acquire any equity related to this investment, and overseas enterprise B is not actually controlled by domestic entities. Does domestic enterprise A need to complete the approval, filing, or large non sensitive reporting procedures for this?

Answer: If domestic enterprise A only provides financing or guarantees for investments related to overseas parent company B, but does not obtain any equity, it does not belong to the overseas investment referred to in Article 2 of Order 11, and there is no need to go through approval, filing, or large non sensitive reporting procedures in this regard.

（21） Domestic enterprise A plans to acquire overseas enterprise B for 0 yuan. The financial report of enterprise B shows that B has certain assets. Is Order 11 applicable to this situation?

Answer: In the process of acquiring overseas enterprise B, domestic enterprise A does not have any assets or equity investments such as currency, securities, physical assets, technology, intellectual property, equity, debt, etc., nor does it provide financing or guarantees, which does not constitute the investment activities referred to in Article 2 of Order 11 and does not apply to Order 11.

（22） Is Order No. 11 applicable to domestic enterprise A providing financial support to overseas subsidiary A for its daily business activities?

Answer: Domestic enterprises are subject to Order No. 11 when increasing their capital to overseas subsidiaries (the parent company increases the registered capital of its subsidiaries, etc., without the need for subsidiaries to repay). Domestic enterprises lend money to overseas subsidiaries through overseas loans (the parent company lends money to the subsidiary, and the subsidiary needs to repay it within a certain period of time in accordance with foreign exchange management regulations), which is not subject to Order No. 11.

（23） Is Order No. 11 applicable to domestic enterprise A's plan to purchase convertible corporate bonds issued by overseas enterprise B? Is Order No. 11 applicable to domestic enterprise A's plan to convert its convertible corporate bonds held by overseas enterprise B into equity held by B?

Answer: The purchase of convertible corporate bonds issued by overseas enterprise B by domestic enterprise A is not subject to Order No. 11. Domestic enterprise A intends to convert its convertible corporate bonds of overseas enterprise B into equity of B, subject to Order No. 11.

2、 Sensitive projects

（24） What specific overseas investment activities does the term "research, development, production, and maintenance of weapons and equipment" refer to in the 2018 Catalogue of Sensitive Industries for Overseas Investment?

Answer: The term "research, development, production, and maintenance of weapons and equipment" in the Catalogue mainly refers to the following overseas investment activities: research and development, production, maintenance, and support of weapons and equipment.

（25） What specific overseas investment activities does the term "cross-border water resource development and utilization" refer to in the 2018 Catalogue of Sensitive Industries for Overseas Investment?

Answer: The term "cross-border water resource development and utilization" referred to in the Catalogue mainly refers to the following overseas investment activities: water resource development and utilization on rivers flowing through the borders of two or more countries.

（26） What specific overseas investment activities does the term "news media" refer to in the 2018 Catalogue of Sensitive Industries for Overseas Investment?

Answer: The term "news media" referred to in the Catalogue mainly refers to the following overseas investment activities: the establishment or acquisition of overseas news institutions (including news websites), publishing institutions, broadcasting and television institutions that involve current affairs and have a significant impact on national security. The term "news media" referred to in the Catalogue does not include the following overseas investment projects: domestic news institutions, publishing institutions, broadcasting and television institutions, etc. establishing branches overseas, increasing capital to daily operations of overseas branches, etc.

（27） What specific overseas investment activities does the term "real estate" refer to in the 2018 Catalogue of Sensitive Industries for Overseas Investment?

Answer: The term "real estate" referred to in the Catalogue mainly refers to the following two types of overseas investment activities: (1) investing assets, equity or providing financing, guarantees, etc. from within the country, constructing or acquiring residential or commercial real estate projects overseas, and acquiring land for the construction of residential or commercial real estate; (2) Investing assets, equity or providing financing, guarantees, etc. from within the country, establishing or acquiring real estate enterprises overseas, increasing investment in existing overseas real estate enterprises, investing in overseas real estate trust funds, etc. The term "real estate" referred to in the Catalogue does not include the following six types of overseas investment activities: (1) investment property management and real estate intermediary services; (2) Newly built or acquired office spaces, employee dormitories, etc. for self use by enterprises; (3) Investment in infrastructure construction and building development for physical industries, such as industrial parks, science and technology parks, warehousing and logistics parks, etc; (4) Construction companies invest a small proportion in the projects they plan to undertake with the aim of obtaining engineering contracting contracts; (5) Projects that have obtained approval documents or filing notices from the development and reform department in accordance with the law and regulations, but have not yet been completed; (6) Projects that do not involve domestic investment in assets or equity, nor do they involve domestic financing, guarantees, etc., and all funds are raised from overseas.

（28） What specific overseas investment activities does the term "hotel" refer to in the 2018 Catalogue of Sensitive Industries for Overseas Investment?

Answer: The term "hotel" referred to in the Catalogue mainly refers to the following overseas investment activities: investing assets, equity or providing financing, guarantees, etc. from within the country, building or acquiring star rated hotels, tourist resorts, business hotels, general hotels, etc. The term "hotel" referred to in the Catalogue does not include the following four types of overseas investment activities: (1) investing in the hotel management industry that does not hold hotel property assets; (2) Investing in the catering industry without accommodation; (3) Projects that have obtained approval documents or filing notices from the development and reform department in accordance with the law and regulations, but have not yet been completed; (4) Projects that do not involve domestic investment in assets or equity, nor do they involve domestic financing, guarantees, etc., and all funds are raised from overseas.

（29） What specific overseas investment activities does the term "cinema" refer to in the 2018 Catalogue of Sensitive Industries for Overseas Investment?

Answer: The term "cinema" referred to in the Catalogue mainly refers to the following overseas investment activities: building or acquiring overseas cinemas and cinema line companies.

（30） What specific overseas investment activities does the "entertainment industry" referred to in the 2018 Catalogue of Sensitive Industries for Overseas Investment refer to?

Answer: The "entertainment industry" referred to in the Catalogue mainly refers to the following overseas investment activities: (1) building or acquiring overseas indoor entertainment facilities (dance halls, electronic entertainment halls, internet cafes, etc.); (2) New construction or acquisition of overseas amusement parks, theme parks, etc; (3) Establish or acquire overseas lottery companies.

（31） What specific overseas investment activities does the term "sports club" refer to in the 2018 Catalogue of Sensitive Industries for Overseas Investment?

Answer: The term "sports clubs" referred to in the Catalogue mainly refers to overseas investment activities such as establishing or acquiring organizations, institutions, enterprises, etc. that hire (or rent) athletes to engage in sports competitions, performances, training, coaching, and management.

（32） What specific overseas investment activities does the term "establishing equity investment funds or investment platforms without specific industrial projects overseas" refer to in the 2018 Catalogue of Sensitive Industries for Overseas Investment?

Answer: The term "establishing equity investment funds or investment platforms without specific industrial projects overseas" referred to in the Catalogue mainly refers to the following overseas investment activities: investing assets, equity or providing financing, guarantees, etc. from within the country, and establishing equity investment funds or investment platforms without specific industrial projects overseas. The term "equity investment funds or investment platforms without specific industrial projects established overseas" referred to in the Catalogue does not include the following two types of overseas investment activities: (1) equity investment funds or investment platforms that do not involve domestic investment of assets, equity, nor domestic financing, guarantees, etc., and all funds are raised from overseas; (2) Domestic financial enterprises that have obtained approval from domestic financial regulatory authorities may establish equity investment funds or investment platforms overseas without specific industrial projects.

（33） Is the establishment of a special purpose company overseas by domestic enterprises for the purpose of issuing bonds overseas a sensitive industry for overseas investment? Does it belong to the category of setting up equity investment funds or investment platforms without specific industrial projects overseas?

Answer: Domestic enterprises establish special purpose companies overseas for issuing bonds for overseas financing. The activity of establishing special purpose companies does not belong to the sensitive industry of overseas investment. "Establishing equity investment funds or investment platforms without specific industrial projects overseas".

（34） Is the acquisition of overseas music production companies or film and television production companies by domestic enterprises a foreign investment project involving sensitive industries?

Answer: The acquisition of overseas music production companies or film and television production companies by domestic enterprises is not a sensitive industry overseas investment project.

（35） A certain investment project of domestic enterprise A was not classified as a sensitive project when obtaining the filing notice. At present, the industry to which the project belongs is classified as a sensitive industry. Domestic enterprise A intends to make changes to the relevant matters of the project. Should the above situation be applied for filing changes or project approval?

Answer: Categorize according to the following situations: (1) If the enterprise intends to change the construction scale and content, especially to add new construction scale and content for the sensitive industry, it should apply for approval as a new project. (2) If the construction scale and content originally recorded do not change, such as due to exchange rates or market factors, changes in the amount of Chinese investment, etc., an application for registration change can be made.

（36） What are the specific conditions for approving projects involving sensitive industries?

Answer: According to Article 26 of Order No. 11, the conditions for the approval authority to approve a project are:

(1) Not violating Chinese laws and regulations;

(2) Not violating China's relevant development plans, macroeconomic regulation policies, industrial policies, and opening-up policies;

(3) Not violating international treaties or agreements that our country has concluded or participated in;

(4) Not threatening or damaging our national interests and security. It should be pointed out that for projects involving sensitive industries that meet one of the following two conditions, the approval authority generally considers them as not violating the "macroeconomic control policy" stipulated in Article 26 (2) of Order No. 11: (1) The project belongs to intergovernmental cooperation projects; (2) During the process of soliciting opinions from the approval authority on the project, relevant industry regulatory departments and embassies abroad clearly expressed their support for the project.

3、 New project application

（37） At which stage should the investment entity complete the approval or filing procedures for overseas investment projects?

Answer: According to Article 32 of Order No. 11, for projects that fall within the scope of approval and filing management, the investment entity shall obtain the project approval document or filing notice before the project implementation. The term "before the implementation of a project" referred to in Order No. 11 refers to the investment of assets, equity (excluding pre project expenses that have been approved and filed in accordance with Article 17 of Order No. 11) or the provision of financing or guarantees by the investment entity or its controlled overseas enterprises for the project.

（38） Domestic enterprise A plans to establish overseas enterprise A and will not invest in asset equity temporarily (without paying in registered capital and conducting other overseas investment activities). When should A complete the approval and filing procedures?

Answer: According to Article 32 of Order No. 11, enterprises should obtain project approval documents or filing notices before project implementation. Specifically, if domestic enterprise A intends to establish overseas enterprise A, A should obtain project approval documents or filing notices before investing assets, equity, or providing financing or guarantees for A. A can register overseas enterprise A first, but before actual investment (such as paying in registered capital, investing in asset equity for mergers and acquisitions or green space investments, etc.), project approval documents or filing notices should be obtained.

（39） Where should local enterprises apply for overseas investment approval and filing when conducting overseas investment projects that do not involve sensitive countries, regions, or industries, and the Chinese investment amount does not exceed 300 million US dollars?

Answer: According to Article 14 of Order No. 11, if local enterprises carry out non sensitive overseas investments and the Chinese investment amount is less than 300 million US dollars, the filing authority is the provincial government development and reform department in the place where the investment subject is registered. If you need to handle relevant procedures in other departments, please consult the corresponding department.

（40） The Notice of the General Office of the State Council on Forwarding the Guiding Opinions of the National Development and Reform Commission, the Ministry of Commerce, the People's Bank of China, and the Ministry of Foreign Affairs on Further Guiding and Regulating the Direction of Overseas Investment (Guo Ban Fa [2017] No. 74) states that the (1), (2), and (3) items listed in "IV. Restricted Overseas Investment" must be approved by the competent department of overseas investment. Do the (4) items "Using outdated production equipment that does not meet the technical standards of the investment destination country for overseas investment" and (5) items "Overseas investment that does not meet the environmental, energy, and safety standards of the investment destination country" need to be approved?

Answer: The fourth (fifth) item does not fall within the scope of overseas investment approval management. Overseas investment should meet the technology, environmental protection, energy consumption, and safety standards required by the investment destination country.

（41） Is it necessary for the investment entity to apply for project filing or submit a project status report form for non sensitive projects with a Chinese investment amount not exceeding 300 million US dollars through overseas enterprises under its control?

Answer: If the investment entity carries out non sensitive projects with a Chinese investment amount not exceeding 300 million US dollars through its controlled overseas enterprises, and does not invest assets, equity, financing, or guarantees domestically, the domestic enterprise does not need to apply for filing or submit a report on the situation of large non sensitive projects.

（42） Is the application materials and process for local enterprises to apply for non sensitive overseas investment registration of less than 300 million US dollars to the development and reform department of the provincial government consistent with their application to the National Development and Reform Commission for non sensitive overseas investment registration of more than 300 million US dollars?

Answer: The process is basically consistent and needs to be handled in accordance with the relevant provisions of Order No. 11. Some provinces (cities) have introduced their own overseas investment management measures. Please refer to the actual requirements of the filing authority for specific situations.

（43） Is it a foreign investment referred to in Order No. 11 that domestic enterprise A intends to exchange the equity of its controlled foreign enterprise A with foreign enterprise B?

Answer: Domestic enterprise A uses the equity of its controlled overseas enterprise A to exchange shares with another overseas enterprise B, and A obtains the equity of B. The above activities belong to the overseas investment referred to in Article 2 of the Measures for the Administration of Overseas Investment by Enterprises.

（44） Do domestic enterprises need to apply for project approval and filing with the development and reform department before participating in bidding for overseas oil and gas block projects?

Answer: According to Article 32 of Order No. 11, the investment entity shall obtain the project approval documents or filing notices before the implementation of the project. Before the implementation of the project, it refers to the investment entity or its controlled overseas enterprises investing assets, rights, or providing financing or guarantees for the project. Domestic enterprises participating in overseas project bidding do not need to apply for project approval or filing before participating in the bidding. According to Article 32 of Order No. 11, enterprises can determine the time for application for approval or filing based on the specific situation of the project, and obtain the project approval document or filing notice before the implementation of the project.

（45） How to understand the term "malicious spin off project" referred to in Article 51 of Order No. 11?

Answer: "Malicious splitting of projects" mainly refers to the intentional splitting of a project into multiple projects by investment entities to avoid supervision. It should be pointed out that legitimate and reasonable phased construction based on project needs or general commercial practices does not belong to the "malicious spin off project" referred to in Article 51 of the Measures for the Administration of Overseas Investment by Enterprises.

（46） Should domestic enterprise A, which is partially owned by centrally managed enterprise A, file and approve overseas investment projects in accordance with the regulations of centrally managed enterprise A?

Answer: If central management enterprise A directly or indirectly owns more than half of the voting rights of domestic enterprise A, or although it does not have more than half of the voting rights, it can control important matters such as A's operation, finance, personnel, technology, etc., then A should file and approve overseas investment projects according to the central management enterprise.

（47） Domestic enterprises are undergoing internal restructuring by acquiring overseas asset C held by domestic subsidiary B through domestic subsidiary A, with a transaction agreement amount of 1 US dollar. Should the Chinese investment amount be 1 US dollar or the actual value of overseas asset C when applying for project approval or filing?

Answer: Domestic enterprises need to adjust their internal structure by acquiring overseas asset C held by domestic subsidiary B through domestic subsidiary A. When applying for project approval or filing, the Chinese investment amount can be declared according to the agreed amount of 1 US dollar in the agreement. The approval and filing authorities shall indicate the relevant situation of internal structure adjustment and the actual content of overseas asset C in the approval documents or filing notices.

（48） Domestic enterprises or institutions that establish representative offices or offices overseas are not directly engaged in business activities and are only responsible for business contacts within the scope of business of domestic enterprises or institutions. Can the approval and filing authorities accept such actions?

Answer: When domestic enterprises or institutions establish representative offices or offices overseas, the approval and filing authorities can refer to the newly established enterprises of domestic enterprises overseas for acceptance.

（49） The investor intends to issue bonds overseas to raise funds for overseas investment. Should the investor first apply for foreign debt registration or overseas investment approval and filing?

Answer: According to the relevant provisions of the supporting format text of Order No. 11, investment entities should provide supporting documents proving the authenticity and compliance of the source of investment funds. Among them, if funds are raised through issuing stocks, bonds, or other means, corresponding supporting documents or explanatory documents should be provided. Specifically, if a domestic enterprise intends to raise overseas investment funds through issuing foreign debt and is unable to obtain a foreign debt registration certificate at the time of submitting the application for approval and filing of overseas investment projects, an explanation of the progress of issuing foreign debt should be provided in the project approval and filing application materials.

（50） Is there a sequence between the approval and filing of overseas investment projects by investment entities in the development and reform department, and the completion of procedures related to the establishment of new overseas enterprises in the commerce department?

Answer: No.