Legal Risk Analysis On The Dissolution Of VIE Mode

In view of the strict limitation of foreign investment and the high threshold of IPO in our country,various entities make a choice to achieve overseas listing through VIE mode for development fund.The VIE mode in our country has been established for more than 10 years,widely spreading in the industry of TMT,including Sina,Baidu,and Alibaba,which makes a great growth and development through that way.However,the legality of the VIE mode has been in the grey zone;and with the improvement of domestic legal supervision of the capital market and the low valuation of the foreign market,more and more entities decide to abandon the VIE mode and return to domestic capital market.The most popular case nowadays should be the regression of Qihoo 360.This thesis would focus on that case,analyzing and researching the relevant legal risk issues about its dissolution of VIE mode.The core of the VIE mode is to realize the control of benefits through agreement,but at the same time,the agreement is also the source of its risk.Under the condition that our country’s laws and regulations have not been clear about the legality of the VIE mode,how to gradually dissolve the VIE mode to make the enterprises return to a stable and risk-free state is an important thing that the VIE mode enterprises need to think about.First of all,the thesis explains the basic connotation,the status quo and the legal risks of VIE mode.Then,the thesis makes an introduction about the Qihoo 360,studying its difficulties and legal issues of dissolution of VIE mode.Based on the aforementioned analysis and study,the thesis makes legal advice for the Qihoo 360,in order to provide references for the similar enterprises.