storm of litigation

  How to Deny Shareholder Status When Registered Under False Name Authors: Wang Jingcheng, Li Bin, Zhang Derong, Zhao Baorong (Beijing Yunting Law Firm) Reading Tips False registration refers to the act of using a fictitious legal entity or impersonating someone else to register that entity or individual as a shareholder with the company registration authority, while the actual investor exercises the shareholder rights. In practice, since in some regions the presence of shareholders is not required for company establishment, it is not uncommon for shareholder signatures in business registration materials to be signed by others on their behalf. This leads to many people being registered as company shareholders without their knowledge, so to speak, “trouble comes from the sky while sitting at home.” Filing a lawsuit to deny shareholder qualification is a common remedy for those whose names have been falsely registered. So, how do courts generally determine shareholder status in such ...

  Is the Clause Valid Where a Company Provides a Guarantee for Share Transfers Between Shareholders? By Wang Jingcheng, Zhang Derong, Ruan Di (Beijing Yunting Law Firm) Key Takeaway When a company provides a guarantee for the transfer of shares between shareholders, does this constitute the withdrawal of capital by the transferring shareholder? In this case, the Supreme Court opined that the invalidity of a contract should be strictly determined according to the principle of legalism. The court rejected the validity of the guarantee clause on the grounds that it benefited the shareholders without aligning with the company's operational performance, contradicting the spirit of corporate law. Judicial View If an investor has conducted due diligence and followed formal review procedures through a shareholders' resolution, and the guarantee provided by the company benefits its own operational development without harming the rights of the company and its minority shareholders, the g...

I.    Overview of mergers and acquisitions by foreign-invested enterprises A foreign-invested enterprise is an enterprise established in China in accordance with the provisions of the Law of the People's Republic of China on Foreign Investment, which is jointly invested by a Chinese investor and a foreign investor or invested only by a foreign investor. The mergers and acquisitions of foreign-invested enterprises referred to in this article refers to the behavior involving changes in the equity of foreign-invested enterprises , including both the mergers and acquisitions of foreign-invested enterprises by domestic enterprises that result in the equity of the domestic enterprises containing all or part of the shareholders of the foreign-invested enterprises, and the   mergers and acquisitions of foreign-invested enterprises by domestic enterprises that result in changes in the equity of the foreign-invested enterprises themselves. POINT 1   Mergers and acq...