Company Law Will Be Revised

On December 27, 2022, the second revised draft of Company Law was brought up for consideration at the Standing Committee of the 13th National People’s Congress.

The second revised draft of Company Law mainly strengthens shareholders’ capital contribution responsibilities, improves corporate governance and the provisions of directors’ responsibilities, as well as strengthens the governance of listed companies. If the company cannot pay off its debts when they are due, the shareholders’ capital contribution will be accelerated to maturity; if the shareholders transfer their equity before the deadline of capital contribution, the transferor will assume supplementary liability for the capital contribution not paid by the transferee as scheduled.