Questions on running a company in China (1-10)
Time:2024-07-17 09:12:36Source:Click:次
The new Chinese Company Law was implemented on July 1, 2024. This revision mainly involves improving the company capital system, optimizing corporate governance, and strengthening the protection of shareholders' rights. For common questions about establishing and operating a company in China, we have summarized the following for reference:
1. What are the main contents of the new Company Law revision?
Answer: The main points can be summarized as follows:
· The investment period for shareholders of limited liability companies shall not exceed five years.
· Equity and claims can be used as investment capital.
· Shareholders' meetings and voting can be conducted via electronic communication.
· Information on subscribed and paid-up capital contributions of shareholders must be disclosed on the national enterprise credit information publicity system.
· If the company cannot pay due debts, shareholders must provide capital in advance.
· Shareholders can transfer their shares to external parties without the consent of other shareholders, with written notification.
· The transfer of shares that have not been fully paid requires the transferor to assume supplementary responsibility for the transferee's contribution obligations.
· The board of directors or directors are legally obligated to urge shareholders to pay their contributions.
· Shareholders who refuse to pay their contributions will lose their shareholder rights.
· Dishonest persons (commonly known as "laolai") cannot serve as directors, supervisors, or senior executives of the company.
· The term "executive director" has been removed.
· A company can choose not to establish a board of supervisors or supervisors.
· Restrictions on the establishment of single-shareholder limited liability companies have been relaxed.
· Simplified cancellation and mandatory cancellation systems have been added.
2. Is it mandatory for enterprises to use the "Company Articles of Association Sample" formulated by the registration authority?
Answer: The sample provided by the registration authority is only for investors' reference and is not mandatory for enterprises to use.
3. What should applicants pay attention to when using a customized articles of association for company registration?
Answer:
· Ensure the completeness of the articles of association. It should include the company's name and domicile, business scope, registered capital, shareholders' names, capital contributions, methods and dates of contributions, company structure, legal representative, and any other necessary provisions.
· Ensure the articles of association are legal and valid, not violating any laws or regulations.
· The organization’s structure, shareholder voting rights, and decision-making procedures in the articles of association must comply with the Company Law.
4. Can the articles of association be signed only by some shareholders or the legal representative during company establishment?
Answer: The articles of association of a limited liability company must be signed by all shareholders.
5. Can the articles of association be signed only by some shareholders or the legal representative during company changes?
Answer: Changes to the articles of association must comply with the provisions of the articles of association and be signed by the legal representative on the amended articles or the amendment.
6. What should be noted about articles of association filing?
Answer:
· Companies established before June 30, 2024, that file for articles of association modifications after July 1, 2024, must comply with the new Company Law if the modifications involve new provisions.
· When filing for changes such as the legal representative, directors, or supervisors, companies must submit articles of association that comply with the new Company Law.
· For company cancellation, directors form the liquidation team and this should be reflected in the articles without further revisions.
7. Is there a limit on the number of shareholders in a limited liability company?
Answer: A limited liability company can have between one and fifty shareholders.
8. Can a natural person invest in multiple single-shareholder limited liability companies?
Answer: Yes, a natural person can establish multiple single-shareholder limited liability companies.
9. Can a single-shareholder limited liability company invest in multiple single-shareholder limited liability companies?
Answer: Yes, it can.
10. Do the shareholders of a single-shareholder limited liability company have to be natural persons or legal persons?
Answer: No, the new Company Law removes this restriction.
(To be continued...)
