http://blogs.wsj.com/chinarealtime/2012/01/24/unpacking-the-law-around-the-chinese-reverse-takeover-mess/ "The Chinese government has long rejected American requests to investigate Chinese auditing companies on the grounds of protecting Chinese sovereignty. The American accounting firm Deloitte Touche Tohmatsu is “caught in the middle of conflicting demands by two government regulators,” according to a company spokesman. The U.S. Securities and Exchange Commission (SEC), investigating fraud by a Chinese company listed on the New York Stock Exchange, has demanded that Deloitte produce audits by Deloitte’s Shanghai affiliate. Deloitte has refused to comply with the SEC demand (now the subject of a subpoena from a Federal court) because it fears punishment under Chinese secrecy laws." ..... "Chinese national sovereignty would not be violated if China permits American regulators within its boundaries solely in order to inspect the finances of U.S.-listed Chinese companies. A hard economic reality may underlie China’s resistance to foreign inspection of Chinese audits: Rather than uncovering any “state secrets” protected by Chinese law, thorough inquiries could disclose embarrassing flaws in Chinese financial and auditing practices. But continuing to shield companies from the consequences will only deepen investor mistrust even as China’s presence expands in global markets." ~ from "Unpacking the Law Around the Chinese Reverse Takeover Mess" http://blogs.wsj.com/chinarealtime/2012/01/24/unpacking-the-law-around-the-chinese-reverse-takeover-mess/
... and of course this legal predicament with China is not limited to RTOs.