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In order to contribute to the community and enhance awareness for brands, many companies would sponsor public service activities, themed conference, competitions, and etc., no matter voluntarily or not. Such sponsorship is supposed to be a win-win event, but if the sponsorship is implemented in a wrong way, it may bring risks to those companies. Generally, the risks related to sponsorship include the following: Firstly, it may constitute commercial bribery. Companies provide sponsorship for gain competitive advantages may be recognized as commercial bribery by administrative authorities and judicial authorities, because such sponsorships may be deemed as violations of the “Anti-unfair…

At the end of each year, various business gatherings and enterprises’ annual parties are typical programs. Alcohol is one of the links in those activities. Some people may be tipsy, some people may get drunk, and some people may die. If an individual died due to drinking too much alcohol in a business gathering, whether such death could be identified as a work-related injury? It depends. Firstly, if an employee got drunk and met the intoxication standard, such circumstance shall not be identified as a work-related injury. Both Article 37 of the “Social Security Law” and Article 16 of the…

In order to effectively constrain the counterparty’s behavior and reduce the risk of breach of contract, a contract may prescribe more than one liability for breach of contract regarding the same behavior. For example, if a party failed to pay on due date, it shall bear the interest for overdue payment, in addition, it shall also bear the liquidated damages for overdue payment. When a contract prescribes different liabilities for breach of contract regarding the same behavior, whether the non-defaulting party could claim for all? It shall be determined case by case. Regarding lending contracts, the current judicial interpretation has…

The biggest headache for the HR department is the fake sick leave, such as, an employee went to a hospital and registered for an appointment with the doctor, however, he left after got the registration receipt; an employee brought a fake sick leave certificate; or an employee asked for sick leave regarding his back pain continually. In order to eliminate the fake sick leave, many enterprises require employees to submit documents related to sick leave in their rules and regulations. Those documents including registration receipts, sick leave certificates, medical records, drug lists, inspection reports, hospitalization summaries, etc., by which the…

Recently, we received a consultation from company A, stating that its counterparty had breached the contract, whether they could “Tanking”? For example, they can suspend the supply. When there is an economic downturn, defaults become common. Many companies may have the same concern as company A. From the perspective of litigation, such concern involves the issue of fulfilling the First Performance of the Right of Defense. Article 526 of the “Civil Code” stipulates that, “Where both parties have obligations towards each other and there is an order of priority in respect of the performance of the obligations, and the party…

A company with a longer history may have more senior managers who are going to retire. The successors are ambitious. As the old saying goes, “There is a radish in every pit”, so there must be conflicts of interest between those senior managers and their successors. In Japan, many companies implement a “fixed service year system”, which means that companies would adjust the positions of those senior managers from the management positions to the assistant positions or other specialized positions. The purpose is to vacate the “pit”, allowing the successors to have longer time to take over relevant responsibilities. Then,…

Mr. Wong invested in his friend’s company many years ago. The company has not made any profit for those years. Wong did not care, because he only subscribed for 5% of the company’s registered capital, which is not a real loss. Last year, the company’s business license was revoked, but the rest shareholders remained silent. Wong held the opinion that the company’s business license was revoked, which has the same consequence as a person’s death, the shareholders would only bear the limited liability equal to their subscribed capital contribution, for him, the maximum loss would be CYN 50,000. Unexpectedly, Wong…