Article 2 The merger of a domestic enterprise by a foreign investor, which is mentioned in the present provisions, shall mean that the foreign investor purchases by agreement the share rights of the shareholders of a domestic non-foreign-funded enterprise (hereinafter referred to as “domestic company”) or subscribes a domestic company to increase the capital, and thus modifying the domestic company to establish a foreign-funded enterprise (hereinafter referred to as “share right merger”); or, a foreign investor establishes a foreign-funded enterprise, and through which purchases by agreement the assets of a domestic enterprise and operates its assets, or, a foreign investor purchases by agreement the assets of a domestic enterprise, and then invest such assets to establish a foreign-funded enterprise and operates the assets (hereinafter referred to as “asset merger”).

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