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Legal Update

Draft Judicial Interpretation on PRC Company Law

4 May 2016
Mayer Brown JSM Legal Update
On 12 April 2016, China's Supreme People's Court (SPC) issued a draft judicial interpretation (Draft Interpretation) on the PRC Company Law (Company Law) for public consultation. The Draft Interpretation focuses on five subject areas, namely validity of board and shareholders' resolutions, shareholders' inspection rights, profits distribution, pre-emptive rights in equity transfer and derivative litigation. While the Draft Interpretation provides much needed clarification on a range of issues that are often the subject of disputes in China, especially since the Company Law was revised in 2014, it may also have generated new questions.


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