Annual Report 2019

234 CHINA MERCHANTS PORT HOLDINGS COMPANY LIMITED Notes to the Consolidated Financial Statements For the year ended 31 December 2019 45. PARTICULARS OF PRINCIPAL ASSOCIATES (CONTINUED) Name of associate Place of incorporation/ registration and operation Proportion of effective ownership interest indirectly held by the Company Principal activities 2019 2018 % % Shenzhen China Merchants Qianhai Assets Development Co., Ltd. PRC 14.00 14.00 Property development and management in Qianhai trade zone Terminal Link SAS French Republic 49.00 49.00 Operations of container terminals in Europe, Mediterranean, Africa, Americas and Asia Tianjin Haitian Bonded Logistics Co., Ltd. (Note (a)) PRC 49.00 49.00 Provision of container terminal services and warehouse services Tianjin Port Container Terminal Co., Ltd. (Note (b)) PRC 7.31 N/A Ports and container terminal business Tin-Can Island Container Terminal Ltd. Federal Republic of Nigeria 28.50 28.50 Provision of container terminal services Zhanjiang Port (Group) Co., Ltd. (Note (a) and (c)) PRC 27.58 N/A Ports and container terminal business Notes: (a) Sino-foreign joint ventures. (b) During the year ended 31 December 2019, Tianjin Five Continents International Container Terminal Co., Ltd. (“Tianjin Five Continents”) which previously was accounted as an equity investment at FVTOCI of the Company, entered into a merger agreement with 2 external container companies and their shareholders, pursuant to which Tianjin Five Continents would be absorbed and merged into Tianjin Port Container Terminal Co., Ltd. (“Tianjin Port Container”).The relevant shareholders will hold equity interest in Tianjin Port Container, and the shareholding proportion is determined based on their respective shareholding proportion calculation amount in the original companies. After the completion of the merger, Tianjin Port Container is considered to be an associate of the Company despite that the Group holds less than 20% of the equity interest therein, as the Group has significant influence to appoint and remove the executive committee of the entity, which is empowered to direct the relevant activities of influence of the investee by virtue of the new shareholders’ agreement. (c) During the year ended 31 December 2019, 1,853,518,190 shares of ZJG were issued to a fellow subsidiary and another party. Following the subscription of new shares by the subscribers, the Group’s interest in ZJG has been diluted from 40.29% to 27.58%. Under the new shareholders’ agreement, decisions of relevant activities of ZJG do not require unanimous consent from all of its shareholders, including the Group. Upon completion of the transaction, this entity previously accounted for as a joint venture of the Company has been classified as interest in an associate as the directors considered the Group had significant influence over the investee.