698号函明确为避免外国企业通过滥用组织形式等安排间接转让中国居民企业股权，以达到规避中国所得税的义务。第698号函规定境外投资方间接转让中国居民企业股权，存在以下两种情况下：

　　Provisions in Circular No.698 clearly addresses that prevent the foreign enterprises from evading income tax obligation by indirect transfer of shares of Chinese resident enterprises through arrangements like abusing the corporate governance.

　　（1）被转让的境外控股公司所在国（地区）实际税负低于12.5%；或

　　The real tax burden rate of the jurisdiction where the offshore holding company transferred is incorporated is less than 12.5%; or

　　（2）被转让的境外控股公司所在国（地区）对其居民境外所得不征收所得税。

　　The jurisdiction where the offshore holding company transferred is incorporated does not acquire income tax from foreign-sourced income.

　　应自股权转让合同签订之日起30日内，向被转让股权的中国居民企业所在地主管税务机关提供以下资料，以证明前述间接转让行为具有合理商业目的：

　　shall submit the relevant documents as below to the local taxation bureau where the Chinese domestic enterprises being transferred located within 30 days after the execution of Share Transfer Agreement to prove the aforesaid indirect share transfer is for reasonable commercial purpose.

　　（一）股权转让合同或协议；Share Transfer Contract or Agreement.

　　（二）境外投资方与其所转让的境外控股公司在资金、经营、购销等方面的关系；The relationship between Foreign Investors and Offshore Holding Companies transferred by Foreign Investors regarding finance， operation， purchase and sale， etc;

　　（三）境外投资方所转让的境外控股公司的生产经营、人员、账务、财产等情况；The situation of the operation， personnel， finance， property of the offshore holding companies transferred by foreign investors;