China’s new Company Law: Navigating the Future of Business in China. We are about to witness an important shift in the corporate environment in China. The recent reforms to China’s Company Law bring about significant changes that will take effect on July 1, 2024. All businesses registered in the PRC, including state-owned, privately held, and foreign-invested enterprises (FIE), are subject to the 2024 Company Law. These changes are intended to improve capital sufficiency, strengthen corporate governance, and provide more protection for creditors and minority shareholders. China’s efforts to improve its corporate regulatory framework and promote a more resilient, open, and investor-friendly business ecosystem have reached a significant milestone with these changes. Over the coming weeks we will dive into each of the key amendments and explain how they impact different stakeholders in Chinese companies.
The key amendments are centred on 4 main areas of companies law:
1. Capital Contribution Requirements
2. Corporate Governance
3. Enhanced Protections for Creditors and Minority Shareholders
4. Transfers of Equity Interest
For more information and guidance on these changes please reach out to our China team, led by Kristy Calvert (calvertkristy@martinsadvisory.com) and Shannon Lee (leeshannon@martinsadvisory.com).