Publications

Due to the economic downturn, some companies have to dissolve and liquidate. However, there are many risks during the dissolution and liquidation if the company failed to handle the procedure properly. In particular, the Company Law revised in 2023 (hereinafter referred to as the “New Company Law”) has amended or added provisions regarding liquidation, which deserves attention. This article sorts out the relevant risks with the main focus on the subject of liability assumption during the liquidation of a limited liability company. Legal Risks Related to Liquidation Obligors The original Company Law did not specify the definition or scope of…

Company A did not take out the work-related injury insurance for its employees, but instead it took out a group accident insurance. Sun got injured at work. After Sun received the claim payment from the insurance company, he sued the company, demanding for the work-related injury insurance benefits. Company A defended that Sun had already received the claim payment from the insurance company, he should not be entitled to double compensation. However, both the court of first-instance and the court of second-instance supported Sun’s claim. Company B did not take out the work-related injury insurance for its employees, but instead…

In foreign-funded enterprises and private enterprises, the top-3 common duty-related crimes are: the crime of job-related embezzlement, the crime of accepting bribes by non-state functionaries, and the crime of misappropriating funds. The standards for the completion of these crimes usually involve the actual acquisition or control of property, etc. However, during the process of disposing of the illicit money and goods, the perpetrator may carry out other acts to conceal the illegal gains. That is, in relation to the upstream crime of the duty-related crime, there are also downstream criminal acts. The general theory in criminal law holds that the…

The company agreed with Zhou that his monthly salary would be CNY4,000, including overtime pay. After Zhou resigned, he filed for labor arbitration, demanding that the company pay him overtime pay. The company admitted that there was overtime work but argued that the agreed monthly salary already included overtime pay. The arbitration commission ruled that the company should pay the difference in overtime pay. This case was one of the typical labor and personnel dispute cases released by the Supreme People’s Court in 2022. Some enterprises agree with their employees on a fixed salary amount which includes fixed normal working…

The “Commercial Defamation” normally refers to an operator discredits its competitor’s business reputation, damages its competitor’s competitive advantages, seizes competitive opportunities, and disrupts the fair competition market environment, by fabricating false information or other means. However, it is very difficult to determine whether an operator constitutes commercial defamation. Therefore, it is necessary for us to have a thorough understanding of the constituent elements and common types of commercial defamation. Article 11 of the “Anti-Unfair Competition Law” stipulates that, “Operators shall not fabricate or disseminate false or misleading information that damages the business reputation and product reputation of competitors”. Article 20…

Article 25 of the revised “Population and Family Planning Law” in 2015 stipulates that, ” Couples that give birth to children in compliance with the provisions of laws and regulations may be entitled to rewards of longer maternity leave or other benefits.” This is the fundamental legal basis for male employee’s paternity leave. (The title of this leave is varied in different provinces and cities, such as “nursing leave” or “care leave”, and etc., we will use “male employee’s paternity leave” collectively in this article.) However, due to the lack of unified regulations on the number of days and benefits of…

In order to obtain the convenience regarding litigations, many companies would agree on a specific dispute jurisdiction court in the contract, such as “under the jurisdiction of the court where the plaintiff is located”, “under the jurisdiction of the court where the contract is signed”, and so on. However, in judicial practice, such agreement might be deemed as invalid. Article 35 of the “Civil Procedure Law” stipulates: “The litigants of a contract dispute or other property rights dispute may agree in writing on selection of the court at the location of the defendant’s domicile, place of performance of contract, place…

Many companies organize team building activities to increase employee interaction, and enhance teamwork spirit. Compared with other activities, tourism has more potential risks, so companies pay more attention to the safety and intensity of relevant issues, such as the location, schedule and so on. However, for those employees in special circumstances, such as a pregnant employee or an employee just recovered from a serious illness, the possibility of potential risks becomes higher. If there is any accident, the company may have to undertake more liabilities. Such as if an employee got injured, some courts may consider such injury sustained during…

In practice, if a seller has concerns on whether the buyer may be able to make payments timely, normally it may require the buyer to mortgage properties or provide a third-party’s guarantee. Where the buyer provides a third-party’s guarantee, if the principal claim-debt contract is altered, whether the guarantee liability shall be altered correspondingly? The answer is negative. There are different circumstances regarding such alteration, which shall be discussed separately. The first circumstance is that the guarantee liability shall be altered correspondingly. Article 695, Paragraph 1 of the “Civil Code” stipulates: “Where the creditor and debtor, without the written consent…

Zhang was a product support engineer. On January 28th, 2019, the company notified Zhang that his employment contract would be terminated due to his incompetence. On January 30th, Zhang filed an appeal to the company’s HR department. On March 4th, the managers of relevant departments discussed on the appeal, after discussed on several specific work issues, they decided that Zhang was not competent for the job. On March 4th and March 7th, the company notified Zhang twice to participate in the performance improvement plan, but Zhang refused. On April 10th, the company notified Zhang that he was still incompetent, since…