CaseStudyCase:CompanyStructurePlanningforPre-InitialPublicOfferings(Pre-IPO)Client:IndustryLeadingTaiwanRetailersIndustry:RetailingTheclientisalarge-scaleretailerfromTaiwan,andtherelatedenterpriseofanotedfoodmanufacturinggroupinTaiwan.Theclient’smajorbusinessisoperatingachainofconvenientstoresinMainlandChina,Taiwan,HongKongandSoutheastAsia.Atthemoment,theclientisthelargestconveniencestoreoperatorinTaiwan.BackgroundUnderthenewlyenforcedEnterpriseIncomeTaxLawofthePeople’sRepublicofChinafrom1stJanuary2008,aseriesofnewregulationshavebeenintroducedintheareasoftheresidentialidentityofforeign-fundedenterprises,corporateincometax,withholdingincometaxandotherrelatedmatters,makingasignificantimpactontheforeign-ownedenterprisesoperatingbusinessinChina.Inordertoadapttothenewcorporateincometaxlaw,aplentyofforeigninvestedenterpriseshaveadaptedandoptimizedtheoverallcompanystructureoneafteranother,consideringtheelementsincludingtaxation,capitalraising,goingpublicandothercorporateoperationalfactors,fortheexpresspurposeofhelpingtoachievethemaximizationofthecorporategroup’sbenefits.Inthiscontext,resortingtoManivest’sadvantageofbeingfamiliarwithHongKonglawandtheoperationofHongKongcompanies,anesteemedaccountingfirmintroducedtheclienttoManivest,hopingustoassistthefirmandtheclienttoproceedwiththeadjustmentofcompanystructureinAsia-Pacific,takingtheclient’scompanytopublicinHongKongwiththeaimoftaxsaving.Manivest’sProfessionalAdviceAfterin-depthandadequatecommunicationswiththeengagedaccountingfirmemployedbytheclient,itisfoundbyusthatthedomesticcompanyinChinaisheldtogetherbyaBritishVirginIslands(HK)companyandaHongKong(HK)Company.Nonetheless,BVIcompaniescouldnotbelistedinHKbackin2008.Inaddition,thedomesticcompanyinChinaisdirectlyheldbyaBVIcompany,theagreeddividendtaxrateofwhichis10%,representingtheadjustabletaxationarrangement,sincethetaxrateinHKandMainlandChinais5%.Consequently,forthesakeoflistingallassetsandpropertieswithinthedomesticcompanyinChinainHKonpackaged,thef