Company Law of the People's Republic of China

The Company Law of the People's Republic of China was amended and adopted by the seventh session of the 14th National People's Congress Standing Committee on December 29,2023, and will take effect on July 1, 2024.

Who can serve as the legal representative?

The new Company Law expands the scope of the company legal representative.

According to the old Company Law, the chairman of the board, the executive director and the manager can be the legal representative of the company, but there is no clear rule about whether the directors other than the chairman can be the legal representative.

The new Company Law, Article 10, Paragraph 1, states that "the legal representative of a company shall be the director or manager who represents the company in managing its affairs, as stipulated in the company's articles of association."

The new Company Law no longer restricts the scope of the legal representative to the manager, the chairman, and the executive director equivalent to the chairman, but stipulates that any director who can represent the company to carry out business can be the legal representative of the company.

resignation of legal representative

The new Company Law has added the provisions on the resignation of the legal representative.

Article 10, Paragraph 2 of the revised Company Law stipulates: "When a director or manager serving as legal representative resigns, it shall be deemed as their simultaneous resignation from the position of leg

This provision carries two implications. Firstly, if a legal representative resigns from their position as a director or manager, and they no longer qualify as such under Paragraph 1 of this article, their resignation shall be deemed to have simultaneously relinquished both the legal representative and director/manager roles. Secondly, resignation solely from the legal representative position shall not preclude their continued service as a director or manager.

reconfirm the legal representative

Article 10, Paragraph 3 of the new Company Law stipulates that the company shall appoint a new legal representative within 30 days after the resignation of the current one.

Change of registration of the legal representative

Article 35, Paragraph 3 of the new Company Law stipulates that when a company changes its legal representative, the application for change registration shall be signed by the new legal representative.