What is equity investment?

Legal analysis: equity investment refers to the act of investing in and purchasing equity of an enterprise for the purpose of participating in or controlling its business activities. The behavior of equity investment may appear not only in the publicly traded market, but also at the time when the company initiates the establishment or issuance, and even at the time of non-public transfer of shares.

Legal basis: Article 27 of the Company Law of People's Republic of China (PRC), shareholders can make capital contributions in cash or in kind, intellectual property rights, land use rights and other non-monetary properties that can be valued in money and transferred according to law. However, except for the property that cannot be used as capital contribution as stipulated by laws and administrative regulations. Non-monetary property as capital contribution shall be evaluated and verified, and its value shall not be overestimated or underestimated. Where there are provisions in laws and administrative regulations on evaluation and pricing, those provisions shall prevail.