Transcript Slide 1
MAY 2013 China SAFE The more things change… … the more they stay the same? • Introductions • Background − Registration of equity programs required before offers can be made − Repatriation requirement and responsibility for enforcement − Approval certificate and special-purpose foreign exchange account(s) − Circular 7 streamlining… not so much? 2 Deciding to file • Employee demand / retention concerns • Cost analysis of filing and ongoing resources • Alternatives without SAFE filing • And where to file? 3 Preparing the application under Circular 7 • Application letter and new registration form • Some standardization/simplification of supporting documents and “proof” of plans, e.g., SEC forms and EDGAR screenshots • Undertaking letter, eligible employees, and non-PRC nationals? • Local entity information • Review planned implementation with broker/stock plan administrator 4 Increased SAFE scrutiny? • Looking back at past grants, past plans, past approvals • Fund flow conversion (or not) • Tax withholding procedures • Treatment of grants post-termination • Local entity changes 5 Practical implementation considerations • Internal administrative processes • Coordination of US entity, broker, finance team, local payroll, individual participants, etc. • Tax payment and reimbursement 6 Compliance going forward under Circular 7 • Annual outbound quota renewals • Quarterly statistical reporting • Notification of changes regarding plans, award terms, corporate structure 7 Questions? • Kim Malvicini Alexion Pharmaceuticals [email protected] • Keith Bilezerian Covidien [email protected] • Joyce Chen Orrick, Herrington & Sutcliffe LLP [email protected] 8