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The differences btw PRC and foreign company law

2019-07-08


In today's global corporate world, many conglomerates have complex and layered shareholding structures with multiple entities in various jurisdictions. Each entity must function as part of a cohesive whole within the larger global group, but will still be governed by company laws or other laws of its respective local jurisdiction. In international M&A deals, parties sometimes approach the corporate governance of a foreign entity (and correspondingly, negotiations of shareholders agreements, joint venture agreements and other matters) by using principles and concepts that they are familiar with in their domestic jurisdiction. These cultural differences can cause misunderstandings, complicate negotiations, and create friction during post-completion integration. In this article, we briefly compare some key differences between PRC companies and common law companies.


Gong Chu, Oscar


A lawyer at DeHeng Law Offices (Shenzhen)

Floor 22/11/19/33, Section B, Anlian Plaza,

No. 4018, Jintian Rd., Shenzhen. 518026 P.R.C

Mobile: +86 135 9049 6399, +86 186 8246 3518