Can company’s creditors go after shareholders who have not paid up subscribed capital?

This is not a new topic on this blog. However, it prompted me to look further into the issue when I realized that in judicial practice, courts are actually very much divided on this issue.

Following the company registered capital reforms initiated back at the end of 2013, the market has witnessed many newly setup companies that have a huge amount of registered …

Watch out your manager for your China business

Just recently a client of mine, a foreign company that has a subsidiary business presence in China, approached me for a service to investigate some suspicious dealings that were made by one of his senior manager in Shanghai subsidiary.

The foreign parent company apparently discerned something fishy from a decline in profits of the subsidiary company and commenced…






Agency between Shareholders and Companies

This is more an academic thought than a practical tip.

I am reading the book “Agency, Partnership and the LLC” (2nd ed, West Nutshell Series)  by J. Dennis Hynes in particular to find support for my personal understanding of the agency relationship between shareholders/members and the companies/corporations they invest.

In China, law scholars seldom…

Answer to a question posed by a blog reader regarding legal representative of China company

Here is the question:

Dear Jason,

Today I was doing some research on the legal representative of WFOE’s. During my research I came across the following article:

Who the hell has the right to represent a company in China?

In your article you mention the following:

When this legal representative resigned by submitting his resignation letter to board of

Derivative Action/lawsuit in China: protection of (small) shareholders

[You can also download the PDF version for review here Derivative Action_140516]

Derivative actions are regarded worldwide as an effective enhancement of corporate governance in terms of protecting shareholders from the misbehaving management of their invested company, and protecting small shareholder from being repressed by controlling shareholders.…