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China Insight - Corporate

New Judicial Interpretation Introduces Stricter Shareholder Liability

01/06/2011

On 6 December 2010 the Supreme People’s Court of the People’s Republic of China (the “PRC”) promulgated Interpretation (III) of Several Issues relating to the Application of the PRC Company Law (“Interpretation III”), which came into force on 16 February 2011.

Interpretation III specifies the application of the PRC Company Law in disputes arising from company establishment, capital contributions and transfer of equity interests. Although procedural in nature, Interpretation III modifies the corporate legal framework in the PRC. Foreign investors should also consider it when drafting or amending corporate documents of foreign invested enterprises (“FIEs”).

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China Insight - Corporate
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Authors

Picture of Ulrike Glueck
Dr. Ulrike Glueck
Managing Partner
Shanghai