2.VIE is a new concept after the 200 1 Enron scandal. Before Enron, one company had the majority voting right of another company before requiring consolidated statements. After Enron, as long as the entity meets VIE standards, consolidated statements are needed. After Enron, financial accounting standards board released FIN46 urgently. According to the provisions of FIN46, an SPE that meets any of the following three conditions should be regarded as a VIE, and its profit and loss status should be included in the balance sheet of the "first beneficiary": (1) There is little venture capital, and this entity (company) is mainly supported by external investment, and its own shareholders only have few voting rights; (2) The shareholders of an entity (company) cannot control the company; (3) The voting rights enjoyed by shareholders are out of proportion to the benefits enjoyed by shareholders.
3. At first, most China companies listed under this structure were Internet companies, such as Sina and Baidu, to meet the relevant regulations of the Ministry of Industry and Information Technology (MIIT) and the General Administration of Press and Publication (GAPP) on providing "Internet value-added services". Most domestic Internet companies become "foreign companies" because they accept overseas financing, but many licenses can only be held by domestic companies. MIIT clearly stipulates that ICP can only be owned by domestic companies, so these companies often set up domestic companies controlled by mainland natural persons to hold business licenses and use other contracts to stipulate the relationship between licensed domestic companies and overseas companies. Later, this structure was extended to many companies listed in the United States without Internet.