What does VIE and SPE stand for?

What does VIE and SPE stand for?

A company may elect to create (or sponsor) a VIE or SPE as a separate business entity, in order to isolate assets and liabilities for structured finance purposes.

What qualifies as a VIE?

A variable interest entity (VIE) refers to a legal business structure in which an investor has a controlling interest despite not having a majority of voting rights. Investors in VIEs do not participate in residual gains or losses.

What is the purpose of a SPE?

A Special Purpose Entity (SPE) is a company specially created to fulfil a narrow, specific purpose. The reasons for setting up an SPE are to: Hold a pool of assets to act as security (collateral) for loans. Pass the financial risks associated with holding a pool of assets to other entities or investor(s)

Is Alibaba a VIE?

The company’s status as a Variable Interest Entity (VIE). When you buy stock in BABA, you technically don’t own shares in Alibaba Group itself, but in an offshore shell company that has a claim to its profits.

What is VIE in China?

Over the past two decades, Chinese issuers have widely used the variable interest entity (VIE) structure to raise overseas capital while, at the same time, ‘satisfying’ China’s regulation of foreign investment in industries that are closed or restricted to foreign capital.

Is Alibaba a VIE structure?

The Chinese government has been pressuring companies to invest in ‘common prosperity’, an initiative to reduce inequality in the country. But in my opinion, the main risk of Alibaba and other Chinese tech companies remains the Variable Interest Entity (VIE) structure.

What is a special purpose entity example?

Example of a Special Purpose Entity A business wants to securitize its receivables in order to gain more immediate cash flow from them. To do so, it sells its receivables to a special purpose entity, which issues securities based on the cash flows represented by the receivables.

What is a qualified SPE?

Qualified SPE means a Wholly Owned Subsidiary of the Borrower formed as a special purpose entity in connection with a Qualified Installment Sale Transaction for the sole purpose of (a) owning and holding the Qualified Installment Sale Note issued in connection with such Qualified Installment Sale Transaction, together …

Is VIE legal in China?

Notwithstanding its broad use since 2000, the VIE structure has been neither recognised nor denied by Chinese authorities in the general sense. Instead, cases challenging the VIE structure have repeatedly revealed that Chinese authorities are reluctant to clarify the legality of the VIE structure.

Is BYD a VIE company?

On Thursday, BYD Co Ltd (BY6:VIE) closed at 38.09, -4.54% below its 52-week high of 39.90, set on Jun 28, 2022.

Is NIO a VIE?

Like many Chinese companies with listings outside of China, Nio is a variable-interest entity, or VIE, a structure created in the 1990s as a workaround for Chinese companies that are not allowed to have direct foreign ownership.

Does SPE use a sorbent?

The sorbents used for SPE are similar to those used in liquid chromatography, including normal phase, reversed phase, size exclusion, and ion exchange. Normal-phase sorbents consist of a stationary phase that is more polar than the solvent or sample matrix that is applied to the SPE sorbent.

What is the process of SPE?

Solid phase extraction (SPE) is a technique designed for rapid, selective sample preparation and purification prior to the chromatographic analysis (e.g. HPLC, GC, TLC). In SPE, one or more analytes from a liquid sample are isolated by extracting, partitioning, and/or adsorbing onto a solid stationary phase.

What is an SPE in real estate?

A single-purpose entity, not to be confused with its more expansive relative, the special-purpose entity (both commonly abbreviated as “SPE”), in the context of a commercial real estate transaction, is a limited liability company or corporation that holds title to particular real estate in which the financing lender …

What is an SPE business?

A special purpose vehicle, also called a special purpose entity (SPE), is a subsidiary created by a parent company to isolate financial risk. Its legal status as a separate company makes its obligations secure even if the parent company goes bankrupt.

How does a special purpose entity work?

Does Warren Buffett Own NIO?

Warren Buffett does not own NIO (NYSE: NIO) stock. However, he does own shares in one of the company’s close competitors, BYD so clearly thinks electric vehicles (EVs) have a strong future.

What does vie stand for?

BREAKING DOWN ‘Variable Interest Entity – VIE’. Variable interest entities (VIEs) are often established as special purpose vehicles (SPVs) to passively hold financial assets, or to actively conduct research and development.

What is Special Purpose Vehicle (SPV)?

It is also sometimes called as the special purpose vehicle Special Purpose Vehicle A Special Purpose Vehicle (SPV) is a separate legal entity created by a company for a single, well-defined, and specific lawful purpose. It also serves as the main parent company’s bankruptcy-remote and has its own assets and liabilities. read more.

What are the characteristics of a vie?

Characteristics include a structure where equity investors do not have sufficient resources to support the ongoing operating needs of the business. In most cases, the VIE is used to protect the business from creditors or legal action.

What are the possible changes in a vie?

Change in the structure of VIE through a change in arrangements/ contracts, resulting in a change in the quantum of equity investment at risk. Change in the proportion of risk faced by investors by way of change in equity and debt structure of the entity resulting in a change in the exposure of gains/losses flowing to the primary beneficiary.