Chinese Company Law & Securities Law Professor LUO Peixin East China University of Political Science and Law Feb. 2013

Brief Self-Introduction  JSD Peking University ( ), Comment editor of the Peking Law Review  Visiting Professor to Yale University (2009) Visiting Professor to USF Law School (2007) Academic Visitor to Oxford University (2001)  Post doctoral research Fellow of Chinese Academy of Social Science ( )  Senior research fellow for Haitong Securities Stock Company ( )

Publications  The Contractual Perspective on Corporate Law (Beijing University Press, 2004)  Translations: 1.The Economic Structure of Corporate Law (Harvard University Press, 1991) 2.Dispute Settlements in the World Trade Organization: Practice and Procedure (Cambridge University Press, 2004) 3.Dividend Policy and Corporate Governance (Oxford University Press, 2004) 4.Corporate Governance in a Changing Economic and Political Environment: Trajectories of Institutional Change (Palgrave Macmillan,2003) 5. Law and Capitalism (Chicago University Press, 2010)

罗培新， 1974 年生，北京大学国际金融法专业博士，中国社会科学院法学所博士后， 华东政法大学科研处处长、国际金融法律学院院长、教授，博导，教育部新世纪优 秀人才，上海市曙光学者，上海市第三届十大 “ 优秀中青年法学家 ” ，新华社特约咨 询专家。 2009 年 年赴美国耶鲁大学访问； 2007 年赴海牙参加世界法律大会； 2007 年任 美国旧金山大学客座教授， 2001 年赴英国牛津大学学习交流， 2003 年 7 月－ 2004 年 7 月任职海通证券研究所高级研究员， 年供职于上海市浦东新区检察院。 中文著作： 《公司法的合同解释》、《 WTO 与国际金融法律实务》、《最新证 券法解读》等九部 英文译著：《公司法的经济结构》、《 WTO 中的争端解决：实践与程序》、 《转型政治和经济背景下的公司治理》、《股利政策与公司治理》等 论文：在《中国社会科学》、《北京大学学报》、《法学研究》、《中国法学》、 《中外法学》、《 US-China Law Review 》等刊物发表中英文论文两百余篇，多篇 转载于《新华文摘》、《中国社会科学文摘》。另在《解放日报》、《南方周末》、 《二十一世纪经济报道》、《 China Daily 》等发表中英文财经法律时评五十余篇。 获奖：北京大学第九届 “ 挑战杯 —— 五四青年科学奖 ” 一等奖、中国法学会证券法学 研究会 2009 年会优秀论文一等奖、中国法学会商法学研究会 2005 年年会优秀论文评 选一等奖、 2004 年深交所第六届会员单位和基金公司优秀研究成果一等奖、北京大 学创新奖、美迈斯 “ 面向二十一世纪法学奖学金 ” 特等奖、君合律师人才奖学金、宝 钢奖、北京大学优秀毕业生、中国社会科学院优秀博士后、华东政法大学第十三届、 第十四届、第十五届、第十六届 “ 学生心目中的最佳教师 ” 等若干奖励。

President of Yale University Prof. Richard Levin

Director of Corporation Law Research Center, Yale Law School Prof. Roberta Romano

Dean of Law School, Cambridge University Director of Corporation Law Research Center Prof. Ellis Ferran

Director of Corporation Law Research Center, The University of Pennsylvania Prof. Jill E.Fisch

Prof. Jill E. Fisch

Chinese Company Law & Securities Law

Warm Notes  Two English Versions of Chinese Company Law Provided by CSRC  Any Question:

Purpose of the Course  A survey of how to form, manage and liquidate a company  An overview on shareholders’ protection  A description and illustration on some related controversial issues in China

The Outline of the Course  The Establishment of LLC and Company Limited by shares  The Corporate Governance  The Fiduciary Duties of Directors & Managers  The Rights of Shareholders and Their Remedies  The Direct & Derivative Suit

The Most Controversial Case in Recent Years A Bank Debts 1.5 Billion( Ⅰ ) A Listed Company (Construction Bank) (Zheng Baiwen Comany) Due Claim allotment 1.5 Billion ( Ⅱ ) exemption( Ⅳ ) 50% Shares Transfer( Ⅴ ) Assets Management Com. Sale ( Ⅲ ) A Company Limited by Shares (Xin Da AMC) (San Lian Company)

Government: the killer behind the curtain? Regional Court the claim for A’ assets will be delayed other creditors Apply for Bankruptcy （ 5 ） pay back the loan 3 Million （ 4 ） A SOE C Bank Acquire assets 3 Million （ 3 ） Bank lending 3 Million （ 2 ） loan payment 3 Million (6) Contribute 500 Thousand RMB （ 1 ） B SOE Local Government

General Introduction General comparison on legislation of company law between US and China The history of Chinese Company Law

Map of the USA

Some US Statutory sources of Corporate Law  MBCA-Model Business Corporation Act  Cal. Corp.-California Corporations Code  Del. GCL.-Delaware General Corporation Law  N.Y BCL.-New York Business Corporation Law

Chinese Administrative Regions

Map of China

One Unitary Country with Multiple Legal Jurisdictions People’s Republic of China (PRC) Law 22 provinces, 4 municipalities, 5 autonomous regions Hongkong Special Administrative Region (HK SAR) Law HK SAR Basic Law, April,1990. Macau Special Administrative Region (Macau SAR) Law Macau SAR Basic Law, March,1999. Taiwan Special Administrative Region (Taiwan SAR) Law-In the future

Figure: Sources and hierarchy of Chinese law Constitution (NPC) Laws (NPC 、 SCNPC) Administrative regulation & ministerial rules (State Council,28 ministries And commissions) SAR laws & Regulations (SAR legislature & government) Local regulations & rules (Legislations & Governments of province And relatively large cities) Autonomous Regulations (Legislatures of autonomous) SEZ regulations &rules (Legislatures & Governments of SEZs) Military regulations &rules (CMC & its departments) International treaties & customs Binding force

Table: Legislative bodies and titles of legislation TitlesNPCSCNP C State Council Ministries & Commissions Provincial Legislatures Provincial governments Constitution√ Basic laws√ Laws√ Decisions√√√√√ Regulations√√√ Implementing regulation √√ provisions√√√ General rules√√ Implementing rules √√ Measures√√ Circulars√√ Orders√√√ Directive√ Autonomous regulations √ Special regulations √

The Distribution of Foreign Direct Investment (FDI) in China (%), 2006 (100 million USD)

General Introduction to the History of Chinese Company Law December 29, 1993 took into effect on July 1, 1994 December 25, 1999 Revised for the first time August 28, 2004 Revised for the second time October 27, 2005 Revised for the third time took into effect on January 1, 2006

The Company Law of 1994 The Company Law of 1999 The Company Law of 2004 The Company Law of 2005 Brief Introduction to the Revisions on Chinese Company Law

The Company Law of 1994 Establish two kinds of companies Recognize the limited liability principle Formulate the basic framework of Corporate Governance

The Company Law of 1999 Permit a flexible capital requirement on high-tech companies Introduce the Special Supervision Institution on SOEs

The Company Law of 2004 Abolish the Approval of CSRC on Price above par value of IPO Introduce the Market-based Pricing of IPO

The Company Law of 2005 Authorize the State Council to legislate Introduce the Mechanisms, including One-person company Piercing the corporate veil Cumulative Voting Dissented Shareholder’s Appraisal Right Relax listing standards of companies

Basic Attributes of Corporations Independent and Perpetual Existence Locus of the power is the Board of Directors Shareholders are last in line to get returns Corporate insiders are not personally liable to outsiders on corporate business debts