Study On Legal Problems Of The Round-trip Investment

Round-trip Investment,as a special phenomenon during the process of importing and using the foreign investment, is caused by a combination of elements such as making the foreign investment policy; the development of the capital market; the reform of the tax regulations and the management of capital projects. It has its own deep and complicated domestic system background. It is an investment made by those domestic citizens who have gone abroad or have transferred their identity to invest the capital back to the domestic country. This kind of investment is getting popular in China nowadays. Though it has helped the private-owned enterprises in financing fundraising, forming a uniformity in the treatment of both domestic and foreign investment. It has also hindered the development of the domestic capital market, causing the erosion of taxes, even the loss of state assets, threatening the national economic security and the direction of our foreign investment policy. In this sense, to discuss the cause and the effect of Round -tripping Investment, as well as a deep and thorough analysis from all the important aspects of international investment, giving useful advices from a legal perspective to regulate its operation, is extremely important for the financial security and economic development of China.This article analyzed the cause and effect on the basis of defining Round-trip Investment through both jurisprudential and economic analysis as well as comparison analysis. By introducing the investment subject, the investment ways, investment aspects and the foreign exchange and taxation, this article has explained why the Round-trip Investment is so special compared to the regular international investment. Meanwhile, this article also analyzed the legal problems caused by the Round-trip Investment, and tries to give constructive suggestions for the making of the laws and regulations in this area by learning other nations'experience in the management of Round -trip Investment.This article has seven parts, with total words of approximately 30000 except for the Introduction.Part one starts with the current scale of the Round-trip Investment in China, reveals many causes of this phenomenon, and introduces both its pros and cons to our economic development.Part two defines this economic phenomenon from legal perspective, gives the concept of Round-trip Investment, analyzes its legal characteristics, tries to give it a theoretical category depending on its different purposes.Part three analyzes the domestic investors as the investment subject of the Round-trip Investment, including the domestic natural person and the domestic legal person. Also, this part mentions that we should borrowed the concept of"long-arm jurisdiction"of the United States to further perfect the our laws and regulations on supervising the investment subject. Part four studies the unique investment way from both investment mode and source of fund, and analyzes legal supervision issues.Part five concentrates on the investment area of the Round-trip Investment. On the one hand, it discusses the different treatments toward the domestic and foreign enterprises of our industrial policy; on the other hand, it has a comparison analyze on the difference of accessing the foreign investors depending on their nationalities.Part six involves the taxation issues of the Round-trip Investment. It explains the system of the tax supervising on Round-trip Investment by introducing China's tax laws and related regulations, especially on the subjects of taxes, the processes of taxes and the rate of taxes. Also, this part explains the how the concept of"actual control"applied by other states would give advices on the new Business Income Taxes Law of China.Part seven mainly discusses the foreign exchange management issues of the Round-trip Investment. As the major characteristic of the Round-trip Investment, the"trans-border capital movement"involves capital outflows and capital inflows. There have also been many changes for the supervising regulations on the Round-trip Investment by foreign exchange management organizations. But still, there are some defects that need to be fixed.The innovative point of this article is the system of the research. Most of the existing researches concentrate on the supervising system and the process of the Round-trip Investment, and give advices by learning the experience of other countries and regions. This article used a unique way by introducing the general elements of international investment, deeply reveals the characteristics of the Round-trip Investment, making a difference from other general foreign investment activities. On this basis, give a study on its unique legal aspects, points out the defects we have now on the supervising system, gives advices on how to improve these defects.Since there are so many things concerning the legal supervising of the Round-trip Investment, and the capability of the writer still needs to be improved. It is unavoidable to have mistakes in the article, please do not hesitate to give any critics and suggestions. Another point is that since the Round-trip Investment doesn't have so many differences from other general foreign investment activities, this article doesn't provide any further analyses on this issues due to the limit of the length of the article, still needs to be further studied in the future.