• Key Excerpts
  • VIE Structure
  • VIE Risks
  • VIE Revenue
  1. Shareholders of Vipshop Information include our co-founders and shareholders Eric Ya Shen and Arthur Xiaobo Hong, holding 99.2% and 0.8% of the total equity interests in Vipshop Information, respectively.
  2. An intermediary holding company.
  3. A subsidiary primarily engaged in warehousing, logistics, product procurement, research and development, technology development and consulting businesses.
  4. Subsidiaries primarily engaged in product procurement to support the logistics network.
  5. Subsidiaries primarily engaged in warehousing and logistics businesses in the cities of Jianyang, Kunshan, Tianjin, Zhaoqing and Ezhou and the regions around them.
  6. A subsidiary primarily engaged in software development and information technology support.
  7. A subsidiary primarily engaged in supplier financing business.
  8. We directly hold 75% of the equity interest in Lefeng.com Limited, a Cayman Islands company, and indirectly hold 5.5% of the equity interest in Lefeng.com Limited, on a fully diluted basis. Our indirect ownership in Lefeng.com Limited is through our ownership of 22% of equity interest in Ovation, which holds 25% of the equity interest in Lefeng.com Limited. Lefeng Shanghai is an indirectly wholly-owned subsidiary of Lefeng.com Limited.

Key excerpts from filing(s) - related to VIEs

The PRC government regulates Internet access, provision of online information and the conduct of online commerce through strict business licensing requirements and other government regulations. These laws and regulations also include limitations on foreign ownership in PRC companies that provide value-added telecommunication services, including commercial Internet content services and online data processing and transaction processing (operating e-commerce) services. Specifically, foreign investors are not allowed to own more than 50% of the equity interests in any entity conducting value-added telecommunication services (except for operating e-commerce), including commercial Internet content provision business.
We are a Cayman Islands company, and two of our PRC subsidiaries, namely Vipshop (China) Co., Ltd., or Vipshop China, and Lefeng (Shanghai) Information Technology Co., Ltd., or Lefeng Shanghai, are wholly foreign-owned enterprises, or WFOEs, under PRC law.
{"To comply with PRC laws and regulations, we conduct our operations in China, including the operations of our Vipshop Online Platform, through two sets of contractual arrangements"=>"one set entered into by (a) Vipshop China, (b) Guangzhou Vipshop Information Technology Co., Ltd., or Vipshop Information, a consolidated affiliated entity, and (c) shareholders of Vipshop Information; and the other set entered into by (x) Lefeng Shanghai, (y) Tianjin Pinjian E-Commerce Co., Ltd. (formerly known as \"Shanghai Pinjian E-Commerce Co., Ltd.\"), or Lefeng Information, a consolidated affiliated entity, and (z) shareholders of Lefeng Information."}
Our consolidated affiliated entity, Vipshop Information, holds an ICP License that is essential to the operation of our business and valid until September 24, 2018. Another consolidated affiliated entity that we set up in mid-2014, Lefeng Information, carries out minimal online retail services at the current stage.
Although we have been advised by our PRC counsel, Han Kun Law Offices, that these contractual arrangements are valid, binding and enforceable under current PRC laws, these contractual arrangements may not be as effective in providing control as direct ownership.
..we cannot assure you that these individuals will act in the best interests of our company should any conflict of interest arise, or that any conflict of interest will be resolved in our favor.

Risks identified in filing(s) - related to VIEs

Substantial uncertainties and restrictions exist with respect to the interpretation and application of PRC laws and regulations relating to online commerce and provision of Internet content in China. If the PRC government finds that the structure we have adopted for our business operations does not comply with PRC laws and regulations, we could be subject to severe penalties, including shut-down of our Vipshop Online Platform.
We rely on contractual arrangements with our consolidated affiliated entities and their respective shareholders for the operation of our business, which may not be as effective as direct ownership. If our consolidated affiliated entities and their respective shareholders fail to perform their obligations under these contractual arrangements, we may have to resort to arbitration or litigation to enforce our rights, which may be time-consuming, unpredictable, expensive and damaging to our operations and reputation.
The shareholders of our consolidated affiliated entities have potential conflict of interest with us, which may adversely affect our business.
We may lose the ability to use and enjoy assets held by our consolidated affiliated entities that are important to the operation of our business if either such entity goes bankrupt or becomes subject to a dissolution or liquidation proceeding.
Substantial uncertainties exist with respect to the enactment timetable, interpretation and implementation of draft PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations.
Our contractual arrangements with our consolidated affiliated entities may result in adverse tax consequences to us.
If our PRC subsidiaries and consolidated affiliated entities fail to obtain and maintain the requisite assets, licenses and approvals required under PRC laws, our business, financial condition and results of operations may be materially and adversely affected.
Year Total Revenue VIEs Revenue Contribution of VIEs %
RMB (in millions)
2014 23,129 18,795 81.26%
2015 40,203 7,389 18.38%
2016 56,591 5,500 9.72%

Ownership and Voting power details

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Source(s)