Optimal Transaction Structuring in China: How Private Equity Firms Can Get the Most out of Their Structures

The private equity market in China has grown substantially, and this growth is expected to continue. However, the current regulatory framework around private equity in China represents a challenge, made worse by its opacity. Three primary types of private equity funds aim to invest in the PRC: offshore funds, onshore domestic funds, and onshore foreign-invested funds. They differ by location, currency, and mix of foreign to domestic capital. This article looks into the key characteristics of each type of fund and determines which is the optimal fund structure.