CHINA Trends and Developments Contributed by: Qiao Zhaoshu, Chen Jie and Terri Wang, Beijing Docvit Law Firm
includes distributions of available cash on an as-is basis, equity succession to incoming investors, and co-ordinated capital reductions followed by reinvest- ment to ensure a smooth handover. In 2025, several data-asset securitisations were approved and launched in China, accelerating finan- cial innovation around data assets. In these transac- tions, cash flows are generated from data assets. The prerequisite for using data assets as underlying assets is the confirmation of rights. The 2022 “Opinions on Building a Data Foundation System to Better Leverage the Role of Data Elements” (later referred to as the “Data 20 Articles”), established a policy framework for a data property-rights regime, enabling rights con- firmation and registration. In China, data assets can be monetised via pledge-backed loans, securitisation, or contribution in kind as equity. Under the applica- ble securitisation rules (CSRC, NAFMII, exchanges, AMAC), underlying assets must have clear title, gener- ate stable and predictable cash flows, and be legally independent with bankruptcy remoteness. Transac- tion design therefore focuses on engineering inde- pendent, stable, and predictable future cash flows, and achieving a true sale from the originator to an SPV with effective bankruptcy remoteness. Using loans secured by pledges over data assets as the underly- ing for securitisation is a practical pathway that aligns with current law. The evolution of blockchain has catalysed asset tokenisation – ie, the tokenisation of RWA – which converts real-world rights into digital tokens that are tradable and transferable on-chain. Since 2024, there have been multiple attempts to issue RWAs backed by mainland assets. A comparatively viable cross-border pathway for onshore assets is to issue and distrib- ute them in Hong Kong under the applicable HKMA framework (and, where relevant, the SFC framework) for the offering and distribution of tokenised products. Key compliance items include establishing a red-chip SPV in Hong Kong, transferring onshore asset inter- ests to the SPV via contractual arrangements, and addressing cross-border fund flows, tax, and conflict- of-laws issues. Beyond Hong Kong, Singapore and the United States are also promising RWA venues. Looking ahead, as e-CNY adoption progresses and cross-border investment channels broaden, support
for policies could further expand the use of RWA financing in asset revitalisation. Enterprise asset-based financing encompasses not only tangible assets, intangible assets, and virtual assets, but also diverse transaction participants with complex legal relationships, often involving cross-bor- der activity. Numerous cases that have entered judi- cial proceedings demonstrate that the market, policy, and judicial environments at the time of dispute may have changed significantly from those in place when the financing projects were initially established. Inno- vative transaction mechanisms, jointly designed by all parties at the time of investment, face numerous challenges when disputes arise and enter litigation or arbitration. These challenges arise not only from the transaction parties themselves, but may also involve the regulatory authorities, judicial institutions, and even legislative bodies. Specific provisions designed to protect investor interests or meet issuer require- ments – including valuation adjustment mechanisms (VAMs), buyback arrangements, and guarantee claus- es – become the litmus test for transaction design- ers when disputes arise. Questions often emerge regarding whether these provisions are legally valid, enforceable and effective in achieving their intended purposes. Lawyers assisting clients in actively navigating market challenges In contemporary financial environments, enterprises utilising assets for innovative financing involve com- plex strategic planning and sophisticated legal opera- tions. Each asset category – including infrastructure, data assets, and their respective rights – faces intri- cate regulatory requirements and commercial arrange- ments, presenting distinct legal challenges and mar- ket risks. Project lawyers must possess deep legal expertise and extensive industry experience to provide professional advice and formulate comprehensive risk management solutions that fully align with commer- cial arrangements and client requirements. During due diligence for determining underlying assets and legal compliance, lawyers assist issuers or financing par- ties in verifying the quality of enterprise assets and the legitimacy of ownership while analysing potential legal risks. In the transaction structuring phase, law- yers must ensure that all relevant agreements comply
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