Introduction

Barely a week ago on December 29, 2023, China’s legislative body passed and President Xi Jinping signed into law the newly revised Company Law, effective from July 1, 2024 (the “New Law”). It makes a big splash to the business community for both the law’s as-pillar significance, and the striking degree of revisions (over a quarter of provisions are involved with major changes). The New Law will bring about a broad spectrum of changes comprising shareholder capital contribution, shareholders’ rights protection, company capital system, corporate governance, company registration, company financing, etc., which may make even just a spreadsheet of bulletin points run dozens of pages long.

At Han Kun, we prioritize our clients’ interests and aim to provide more than just prompt advice. Consequently, we wish to delve deeper into the New Law, decipher the legal changes most pertinent to you, and underscore the implications that demand your attention.

The U-turn in shareholders’ capital contribution obligation

I. Shortened contribution deadline

The 2013 and 2014 revisions of the Company Law transitioned from the registered capital payment registration system to a subscribed capital registration system