Repatriation Strategies – How can a SME get their profits out of China?
In today’s environment, with China as an increasing consumer market, many companies have a respectable part of the total value chain in China. Quite often this results in having money “trapped’ in China. Through the appropriate business model, foreign investors can create solutions and structures to remit cash back to the shareholder or any other related company.
Profit repatriation is a delicate subject under China’s foreign direct investment regime. Various regulatory, formality and tax factors surrounding the issue make it worthwhile for investors to define carefully their repatriation strategies, so as to entail tax and profit outcome that they should be legally entitled to. These strategies may not necessarily be complex or costly, while their effects could be substantial.