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  • 2014-03-17
  • 3 minutes Read
Interpretation of the Supreme People's Court on Issues concerning the Application of Law in the Trial of Disputes over the Lease Financing Contracts has come into force since March 1, 2014 (‘Interpretation’)

Compared to the rapid development of financial lease business, Rules of the Supreme People’s Court on Issues concerning the Application of Law in the Trial of Disputes over the Lease Financing Contracts (No. 19[1996]Fa Fa) is relatively lagged. However, Interpretation has regulated many aspects on those issues related to the lease finance, such as the standard on identifying a lease financing relationship, how to link the lease financing contract with purchase contract, the protection for the leaser’s ownership to the leased item, etc. Hereinafter are 3 important aspects: ‘Sale-leaseback’ shall be deemed as the legal relation of finance lease It’s…

  • 2014-03-17
  • 6 minutes Read
Does Invention-Creation after Demission belong to Service Invention?

As intellectual property plays a more and more important role in competition, disputes over ownership of patent increase. Among which, the disputes triggered by application of patent by former technologists are usually too complicated to be settled. Service Invention (‘SI’) refers to a job-related invention-creation made by any person in execution of the tasks of the entity to which he belongs or by primarily using the material resources of the entity. (Patent Law, Article 6). Currently, SI is mainly defined according to the Detailed Rules for the Implementation of the Patent Law, Article 11, 12. According to Article 12, ‘a…

  • 2014-03-17
  • 3 minutes Read
The Hidden Risk in ‘Proof of Income’

Yang was engaged in a labor dispute with Company A, and applied to the Labor Dispute Arbitration Committees (‘Committees’) for arbitration. Yang offered a ‘Proof of Income’ affixed with the official seal of Company A, and asked for corresponding salary and economic compensation. Company A, however, denied having issued such ‘Proof of Income’, and offered all pay sheets Yang signed to prove the unconformity between ‘Proof of Income’ and the fact. According to the Committees, Company A denied the authenticity of ‘Proof of Income’, but it failed to provide relevant evidence, so verdict was made based on ‘Proof of Income’.…

  • 2014-02-17
  • 2 minutes Read
Interim Provisions on Labor Dispatch (” Provisions”) will Come into Force from March

Provisions which has drawn much attention is finally introduced, and will come into force on Mar., 2014. Provisions will bring a huge effect to employers on the following 4 aspects: The auxiliary position shall be defined through democratic discussion and publicity procedure Provisions allows the employer to define the auxiliary position, however, it adds democratic discussion and publicity procedure stipulated in Labor Contract Law. For those employers, they can make good use of this right; but for those dispatched staffs, if there is no representative of them in the labor union, such auxiliary position may not be defined reasonably. The…

  • 2014-02-17
  • 4 minutes Read
The Risk Prevention of Anonymous Investment

In practice, the anonymous investment is quite common. However, under the existing laws and regulations, the legal risks faced by dormant shareholders are noteworthy, there are mainly as follows: I. The dormant (“D”) shareholders may not obtain the shareholder status. In practice, there is none unified criteria on dealing with such identification cases, generally speaking, the judges would be strict to such appeal. II. The nominal (“N”) shareholders may bring risks to the D shareholders. Such as, a N shareholder may transfer or pledge shares at his own discretion, and then a D shareholder can only claim for breach of…

  • 2014-02-17
  • 4 minutes Read
Why Should Legal Representative be Liable for Company’s Offence?

Company A works on the manufacture and sale of electronic products, which are sold in the domestic market, or to the overseas market by processing on order. It arranges production according to orders, and the raw materials supply will be in short when the clients’ demand is urgent. Because the brand and standard of raw materials for domestic-sale and overseas-sale products are the same, in order to follow up with the due date, manager of production Dept. use non-bonded raw materials for domestic-sale products occasionally. Besides, the general manager who is also the legal representative has to examine and approve…

  • 2014-01-17
  • 2 minutes Read
Provisions on Issues concerning the Application of Law in Hearing Cases of Disputes involving Food and Drugs (the "Provisions") has been issued

Provisions will become effective as of 15 March 2014. Provisions has regulated the guarantee of defective products, claiming for breaching of contract or tort, burden of proof for disputes involving food and drugs. Principle for the guarantee of defective products Where any buyer claims rights against producer and seller, because the buyer purchases food or drug in the condition of having known quality problem in a dispute relating to food or drug, the producer and seller still undertake the liabilities. As we all know that food and drugs are special products which are important to health, so the producer and…

  • 2014-01-17
  • 4 minutes Read
The Impact of Company Law Revision on the Transaction Security

The reversion of “Company Law of PRC” (“New Company Law”) has been released on Dec. 28, 2013, which cancels the requirement of the minimum amount of registered capital for those limited liabilities companies, changes the paid-in capital into the capital subscribed by the shareholders, except those industries regulated by specified regulations, and eliminates the requirements of capital verification. New Company Law will come into force on Mar. 1. 2014. The amendments aforementioned arouse the concern and worry of enterprises on the security risk for the future transactions. Then, what are the impacts of New Company Law on the transaction security?…

  • 2014-01-17
  • 4 minutes Read
Plagiarizing Contract will Infringe Copyright or not?

Company A had made a contract named as “Research on Particular Conditions of Construction Contract 2009” (“2009 Contract”), and obtained “Copyright Registration Certificate” in 2010. 2011, Company B published its announcement of tender, together with Particular Conditions. Company A found that Particular Conditions is similar with 2009 Contract both in structure and content, and it sued Company B for copyright infringement. Upon investigation, it was found that 92.9% of the content of Particular Conditions is the same as 2009 Contract. Company A’s appeal was supported by the court of first instance, however, the court of second instance overrode the decision…

  • 2013-12-17
  • 2 minutes Read
Notice on Issues concerning Individual Income Tax on Enterprise Annuities or Occupational Annuities (“Notice”)has been issued

“Notice” has been issued on Dec. 6, 2013, which will come into force on Jan. 1, 2014. The highlights of this “Notice” on Individual Income Tax (“IIT”) on enterprise annuities or occupational annuities are as follows: Deferred IIT treatment. According to the previous regulations, contributions for enterprise annuities shall be combined with the regular salary and calculate the IIT payable accordingly. “Notice” states that Deferred IIT treatment shall be applied according to the following circumstances. For contributions made by companies,no IIT will arise at the time of contribution; For contributions made by employees, the amount no more than 4% of…