Kim & Chang provided legal advice to NetEase, Inc. (“NetEase”) in connection with its cross-border investment in KIP-CRIT Interactive Contents Fund (hereby referred to as the “Korean Venture Fund”), a venture fund established in Korea.

Given the lack of market precedents in which overseas game companies conducted direct investment in a domestic venture fund in Korea as a limited partner, the transaction required a review of not only the customary issues applicable to investments in a Korean venture fund but also the legal and regulatory issues unique to an overseas entity’s direct investment in a domestic venture fund, such as foreign exchange regulatory requirements.

Our firm represented NetEase and assisted with the successful closing of its investment by handling all aspects of the investment in the Korean Venture Fund, including negotiating with the manager of the Korean Venture Fund (to ensure that the terms of the transaction accurately reflected the client’s commercial objectives), conducting due diligence of the Korean Venture Fund and its manager, reviewing applicable foreign exchange and other regulatory requirements, and reviewing fund formation documents.