Monthly Archives: December 2015

Threshold to Bankrupt Your Debtor in China

When your debtor defaults in your payment, one of the options, probably the most well known one, is to file a petition with court to bankrupt your debtor such that the court can stop all the operation of your debtor, seize whatever is left, turn them into cash and apply the same towards the amount owing to you.

However, this may not be easy in China. Although China has promulgated a western style Bankruptcy Law back to 1 June 2007, most PRC courts had been most reluctant to accept creditors’ applications for insolvency/bankruptcy of enterprises unable to pay their debts as they fell due. That was partially due to other economical, social or even cultural reasons, but technical set back, such as absence of clarity and guidance on the proof of insolvency and the burden of proof, certainly plays a role.

跨境股权质押法律问题初探

在早年美元任性量宽导致其利率水平(包括与美元实行联系汇率的港元利率水平)远远低于国内水平时,众多中国企业(尤其是房地产企业)的自然人老板们都想方设法从境外融资,融资的其中一个要求就是将国内公司的股权进行质押,以担保该等融资。

随着中国境内利率水平在2015年急剧下降而美元加息渐行渐近,上述境外融资加上国内公司股权质押的商业安排吸引力下降,加上经济环境恶化,上述安排的经济纠纷频发。对于中国企业来说,最关键的问题就在于发生经济纠纷之后,如何在境外债权人不配合的情况下解封股权质押。

Is it True That Arbitration Has No Appeal?

In most pro-and-con analysis between arbitration and litigation, one traditional wisdom about the advantage of arbitration is that arbitration should be faster as it has no appeal mechanism. At least in the perspective of PRC, such notion may deserve some critical thinking as it may overlook a very bloody fact: the assets of the correspondent will not turn into cash unless the court where the assets locate are involved.

Unlike litigation proceedings, the arbitration award made by foreign related arbitration tribunal (such as CIETAC) or international arbitration tribunals (such as AAA or ICC) can be relied upon to commence the mandatory enforcement directly in a PRC court. It will not be subject to the PRC court’s substantive judicial scrutiny of the contents thereof, which means that the PRC court shall not hear the merits of the case again. The parties shall not bring other litigation proceedings on the same subject matter.