Supreme People's Court, Provisions on Several Issues Concerning the Application of the «PRC Company Law» (3)

最高人民法院关于适用《中华人民共和国公司法》若干问题的规定(三)

Issues in company capital contribution clarified.

Clp Reference: 2330/11.01.27 Promulgated: 2011-01-27 Effective: 2011-02-16

Revised on February 20 2014. Latest version can be found at: http://www.chinalawandpractice.com/Article/3321465/Provisions-on-Several-Issues-Concerning-the-Application-of-the-PRC-Company-Law-3-Revised.html

Promulgated: January 27 2011


Effective: February 16 2011

Main contents: The Provisions are formulated to clarify the application of the PRC Company Law(中华人民共和国公司法) in trials concerning the establishment of companies, capital contributions and confirmation of equity interests.

Where a promoter, for the purpose of establishing a company, executes a contract with a third party in its own name, the promoter should assume the liability under such contract. Where, after its establishment, the company acknowledges the contract specified in the preceding paragraph, or has actually enjoyed the rights or performed the obligations under such contract, the company should assume the liability under such contract (Article 2).

If an investor makes its capital contribution in the form of non-monetary property that was not appraised and priced in accordance with the law, and the company, other shareholders or a creditor of the company request(s) that a determination to the effect that the investor has failed to perform its capital contribution obligation be rendered, the people's court shall appoint a qualified appraisal firm to appraise and price the property. If the value of the property determined in the appraisal is markedly lower than the value determined in the articles of association of the company, the people's court shall determine that the investor has not fully performed its capital contribution obligation in accordance with the law (Article 9).

If a shareholder fails to perform its capital contribution obligation in full or in part and the company or other shareholders request(s) that it perform such obligation in full, the people's court shall uphold such request (Article 13).

Related legislation: PRC Company Law clp reference:2330/11.01.27promulgated:2011-01-27effective:2011-02-16

This premium content is reserved for
China Law & Practice Subscribers.

  • A database of over 3,000 essential documents including key PRC legislation translated into English
  • A choice of newsletters to alert you to changes affecting your business including sector specific updates
  • Premium access to the mobile optimized site for timely analysis that guides you through China's ever-changing business environment
For enterprise-wide or corporate enquiries, please contact our experienced Sales Professionals at +44 (0)203 868 7546 or [email protected]