Monthly Archives: April 2015

Liabilities of Shareholder and Piercing Corporate Veil in China

One of our most frequently questions asked by foreign investors doing business in China is the scope of liabilities of a shareholder under PRC laws. It totally makes sense as this is the fundamental bottom line for taking any investment acts in China. Interestingly, it is not uncommon that a panic foreign shareholder of an insolvent foreign direct enterprise (“FIE”) was told he / she may be put in jail if his / her company is unable to pay off the debts owed in China. We therefore set forth below some basic understanding of PRC laws in this regard.

Several Issues of Recognition and Enforcement of a Foreign Winning Judgment in China

From the perspective of a litigation lawyer, winning a court judgment is by no means the “happy ever after” ending, despite the client’s tears of joy for surviving the lengthy and torturous litigation hearings. It is just the beginning of another judicial procedure to “enforce” such winning judgment. It normally takes a court to seize and dispose of the assets of the counter party and then apply the proceeds towards the outstanding amount.