The detailed legal interpretation specifically target various illegal fundraising and PE [private equity] activities conducted by various unlicensed and unregistered agents without proper licence, including brokers and entities from foreign countries. It also addresses the issues of misinformation, mis-representation, and misuse of public media to illegally attract investors in China. The interpretation will have great implications and impacts on EB-5 regional center that are seeking Chinese investments through marketing activities in China.Some of the provisions in the interpretation involve blatant fraud, such as promising a refund. It's unclear to me whether and how it extends to projects, for example, where investors are told they're investing in an arena that's already funded.
Tuesday, January 25, 2011
It's not exactly clear how it applies to marketing of EB-5 investment projects like the one involving Atlantic Yards, but a new legal interpretation (translation, shorter version) by the Supreme People's Court of China should be considered a warning for EB-5 marketers, according to consultant Brian Su: