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Offshore Trust Taxation Officially Settled: A Comprehensive Analysis of Announcement No. 21 of 2026
Zhao Qixian analyzes MOF and STA Announcement No. 21 of 2026 and STA Announcement No. 15 of 2026, covering offshore trust tax scope, asset contributions, ongoing income, termination, the 90-day transition window, filing procedures, and compliance priorities for high-net-worth individuals.
Judicial Determination of Malicious Breach in a House Lease Dispute — Analysis of the Zhongshan Case Between Chun Electric Appliance Co., Ltd. and Hua Technology Co., Ltd.
Xue Jiabing and He Yijiong analyze a second-instance house lease dispute decided by the Zhongshan Intermediate People's Court, focusing on malicious breach, the validity of leasing an unlicensed building, rent after early vacating, and adjustment of liquidated damages. The court held that a policy-driven relocation may constitute a breach but does not by itself establish a malicious breach without proof of improper gain or intentional harm.
UAV Export Control and Prevention of Smuggling Legal Risks
China is the world's largest UAV producer and exporter. This article systematically examines the legal boundaries of UAV exports from six perspectives: regulatory framework, scope of controls, common misconceptions, administrative risks, criminal risks, and compliance guidance. It explains the dual military-item and dual-use-item control systems, supplemented by technology export controls, analyzes seven common compliance misconceptions, and provides practical guidance from item identification and licensing through customs declaration, end-user and end-use review, post-export obligations, and self-checks.
A Control and Ownership Dispute Involving a Former ‘Shoe King’: Brief Comments on Nominee Shareholding and Offshore Control of a Hong Kong Company
Using Zhong Da Mining Holding Limited v Lam Wo Ping & Ors, this article examines the relationship among nominee shareholding, beneficial ownership, and procedural defects in company resolutions and offers practical advice for cross-border asset structures.
New Rules Reshape China’s Outbound-Investment Landscape: Key Features, Opportunities, and Challenges under the State Council Regulations on Outbound Investment
China’s first administrative regulation dedicated to outbound investment took effect on July 1, 2026. From the perspective of ODI filings, cross-border M&A, overseas parks, and offshore structures, this article analyzes the new rules’ opportunities and compliance challenges.
An Innovative Mechanism for Ecological and Environmental Damage Compensation: Legal Interpretation and Practice Guide to Labor Substitution
This article examines a representative Zhongshan case in which public-service labor substituted for part of ecological and environmental damage compensation, explaining the mechanism’s legal basis, conditions, procedure, supervision, and practical significance.
Criminal Liability and Governance Pathways for Reverse Proxies of Large-Model AI APIs
As reverse proxies and relay services for generative large-language-model APIs expand, the boundary between technological neutrality and criminal conduct is becoming clearer. This article classifies the conduct and examines criminal liability and civil-criminal governance pathways.
Does Contracting Operation by Gas Companies Constitute a Monopoly? Is the Contract Valid? — A Case Study of the Contract Dispute Involving Liupanshui Yumin Liquefied Petroleum Gas Co., Ltd.
As the bottled-gas industry consolidates, cooperation and contracting arrangements have raised recurring compliance questions. This article examines a Supreme People’s Court case and explains the boundary between lawful integration, antitrust agreements, and unauthorized transfer of operating qualifications.
Judicial Rules on Liquidation Liability of Limited Liability Companies — From the Perspective of a Successful Second-Instance Reversal
Disputes over liquidation liability balance shareholders’ limited liability against creditor protection. This article examines the standards for determining liquidation liability and the defenses available to shareholders through a successful second-instance reversal case.
Exploring the Impact of the New Trade Secret Protection Regulations on the Low-Altitude Economy Industry
The Trade Secret Protection Regulations, effective June 1, 2026, represent a paradigm shift in China's trade secret protection landscape. Attorney Zhao Mengzhu examines the new regulations' evolutionary path, core revisions, and their profound impact on the low-altitude economy industry in terms of rights confirmation, organizational governance, and industrial chain compliance, pointing out that the new regulations are driving the transition of trade secret protection from a 'compliance cost center' to a 'core competitive barrier.'
Trade Secret Analysis Series: Determination of Corresponding Confidentiality Measures (Part I)
In trade secret cases, 'corresponding confidentiality measures' are a core statutory element for establishing trade secret protection, and 'manifestation of the right holder's clear confidentiality intent' is a key point in determining the effectiveness of confidentiality measures. Attorneys Wu Rangjun and Tian Yu analyze the determination standards and practical pitfalls using the Supreme People's Court's typical case (2020) Supreme People's Court IP Civil Final No. 538, providing targeted references for right holders to standardize their confidentiality practices.
Practical Discussion on the Legal Nature of Construction Agency Contracts and Payment Liability Subjects
As the real estate industry enters a period of deep adjustment, construction agency as an asset-light model has gained market favor. However, China has not yet provided a clear definition of 'construction agency,' and both the legal nature of construction agency contracts and the subject liable for project payments remain controversial in judicial practice. Attorney Lai Yuxiang conducts an in-depth discussion of these two core practical issues by examining judicial opinions from the Supreme People's Court and multiple Higher People's Courts, providing references for handling similar disputes.
International Trade Risk Response Under the Hormuz Strait Blockade
Affected by the Iran-Israel conflict, on February 28, 2026, Iran announced the closure of the Hormuz Strait, directly impacting the performance of international trade contracts. Attorneys Jin Zuopeng, Sun Ming, and Cui Shaolong analyze risk points for international trade enterprises from a practical perspective by examining UK law, CISG, Hague Rules, and Incoterms, providing actionable response plans including practical approaches to four high-frequency dispute scenarios and contract clause optimization recommendations.
New Company Law Series on Legal Representative (Part I): Role Positioning and Representation Authority
As the first article in the series on legal representatives under the new Company Law, this article focuses on the role positioning and representation authority of legal representatives. Attorney Ke Cheng begins with the origin and evolution of the legal representative system, analyzes its positioning within the corporate governance structure—namely that the legal representative is not an independent institution but a derivative channel for the company's external expression of intent from the board of directors—and outlines the boundaries and limitations of representation authority, including restrictions by the articles of association or shareholders' meetings and the balance mechanism that such restrictions cannot be asserted against bona fide third parties.
Practical Distinction Between the Crime of Organizing Prostitution and the Crime of Harboring Prostitution — A Class Action Analysis Centered on the Essence of "Management and Control" and the Requirement of "Simultaneous Presence of Three Persons"
Attorneys Dai Mingzhong and Zhang Shiqi systematically elaborate on the criteria for distinguishing between the crime of organizing prostitution and the crime of harboring prostitution, along with defense strategies. The sentencing differences between the two crimes are significant, and the essential distinction lies in whether the actor has formed substantive "management and control" over the prostitution activities and personnel. The crime of organizing prostitution requires the actor to actively recruit and employ individuals, and to exercise dominion over personnel grouping, activity scheduling, unified fee collection and distribution, and internal rules, with the controlled prostitutes numbering three or more. The crime of harboring prostitution merely involves passively providing a venue without intervening in core operations. In practice, determining "management and control" requires a comprehensive examination of four dimensions: control over persons, affairs, money, and rules. Regarding the numerical standard, judicial practice clearly adopts the "simultaneous control theory," excluding cumulative calculation, emphasizing that three or more persons must be simultaneously controlled within the same time period. For new models such as online solicitation and cooperative affiliation, the defense should focus on whether the actor holds control over pricing, scheduling, and profit distribution. The article concludes by reviewing key evidence examination points such as WeChat records and financial flows, and proposes defense strategies for the investigation, prosecution, and trial stages, emphasizing that lawyers should intervene early to achieve effective defense through precise evidence challenges and the dissociation of the management and control elements.
In-depth Analysis of Judicial Adjudication Trends in Trade Secret Civil Disputes: An Empirical Study Based on Typical Cases of the Supreme People’s Court in 2025
Based on the Supreme People's Court's 2025 intellectual property trial practice, Attorney Wu Rangjun systematically analyzes seven core trends in the judicial protection of trade secrets: the scope of protection shifting from discrete secret points to systematic overall protection, adhering to carrier-defined boundaries; infringement determination piercing the corporate veil to precisely regulate joint infringement and team poaching; optimized allocation of burden of proof, strengthening burden shifting and sanctions against obstruction of evidence; strict substantive examination of defenses such as independent development, publicly known information, and reverse engineering; compensation judgments adopting refined calculation models and maximum punitive damages, with support for reasonable enforcement costs; innovative enforcement mechanisms detailing injunctive relief orders and creating differentiated delay damages to resolve enforcement difficulties; protection orientation focusing on high-precision and cutting-edge core technologies, upholding equal protection for Chinese and foreign parties and independent review of criminal and civil procedures. Current adjudication rules are increasingly precise, with judicial protection transitioning from dispute resolution to substantive, precise, and efficient protection, providing clear guidance for enterprise compliance management and rights enforcement, and continuously offering strong judicial safeguards for the development of new quality productive forces.
Brand Protection Guide for Mainland Enterprises in Hong Kong
Addressing the common issues of brand squatting or "shadow companies" encountered by Mainland enterprises when expanding into Hong Kong, the article points out that Hong Kong company name rights, trademark rights, and domain name rights are independent of each other, and registering a company does not equate to obtaining exclusive brand rights. It recommends building a proactive defense system of "trademark first, domain name positioning, and continuous monitoring": apply for Hong Kong trademarks in advance covering related categories, register core domain names early, and establish regular monitoring of registered names. When encountering infringement, enterprises may file complaints with the Companies Registry, resolve domain name disputes through the UDRP mechanism, or initiate civil litigation. Enterprises should prioritize brand protection as part of their strategic planning and establish a comprehensive compliance system to avoid cross-border intellectual property risks.
How to Handle Mainland China Estate Involving a Dual Nationality Person When the Original Singapore Will is Missing — One of Longan Guangzhou's Major Business Achievements in 2025
Attorney Li Dingbang uses a real case where a testator made a will in Singapore, but the original document was lost and the estate was located in Mainland China, as an entry point to analyze the characterization of foreign-related wills and the standards for determining their formal and substantive validity (e.g., applying Singapore law to recognize the will's form and the separate property regime). In response to practical challenges such as disputes over dual nationality, the inadequacy of the domestic estate administrator system, and the loss of the original will, the article proposes innovative operational paths, including supplementing evidence with a "Singapore court probate + attorney opinion letter + heirs' non-dispute confirmation," transferring the authority of the administrator, and combining litigation with non-litigation (pre-litigation mediation). Finally, the article summarizes three key points for cross-border wealth succession: prudent appointment of a domestic estate administrator, high attention to the safekeeping of the original will, and awareness of the costs and compliance risks arising from differing standards for cross-border estate transfer, aiming to provide compliant and efficient succession references for high-net-worth individuals.
Provisions and Considerations of the Capital Contribution System in the Judicial Interpretation of the New Company Law (Draft for Comment)
Attorney KE Cheng systematically interprets the core rules of the shareholder capital contribution system in the 'Judicial Interpretation of the New Company Law (Draft for Comment)'. Centering on the basic framework of contribution subjects, methods, deadlines, amounts, and registered capital, the article details provisions on the validity of shareholder agreements, the liability of companies in the process of incorporation, the determination of nominal and illegal contributions, rules for non-monetary and creditor's rights contributions, the accelerated maturity of contributions and burden of proof, restrictions and forfeiture of shareholder rights, as well as illegal capital reduction and the illicit withdrawal of capital contributions. Building on this, the article comprehensively outlines the liability mechanisms for defective shareholder contributions towards the company, other shareholders, creditors, and directors, and proposes optimization suggestions for procedural coordination involving multiple creditors and shareholders. Finally, combining practical controversies, the author critically analyzes the application difficulties and drafting flaws of certain clauses, proposing specific modifications to provide practical guidance for accurately understanding and applying the capital contribution system of the new Company Law.
Opportunities and Challenges in Criminal Legal Services Over the Next Five Years: Insights from the "Eighth National Criminal Trial Work Conference"
The Eighth National Criminal Trial Work Conference held in November 2025 set the direction and priorities for China's criminal justice over the next five years. Conference data showed a continued decline in traditional violent crimes, while cyber crimes and economic crimes were on the rise, with significant growth in demand for specialized criminal legal services. The会议 established a judicial philosophy of "combining professional legal judgment with the public's simple sense of fairness and justice," adhering to a policy of combining leniency with severity, with a focus on severely punishing crimes endangering national security, corruption, and new types of cyber crimes. It also provided specific guidance on juvenile delinquency governance, cyberspace regulation, and the application of the death penalty. Under this导向, criminal defense lawyers need to elevate their political awareness to accurately grasp judicial policies, strengthen their analytical skills to conduct case-specific analysis, and enhance their legal reasoning and communication techniques to integrate professional legal logic with public perception, thereby achieving high-quality effective defense and protection of clients' rights.
Manifestations and Countermeasures of Defects in the Company’s Guarantee Liability in Private Equity Fund Repurchases – From the Investor’s Perspective
Lawyers Wei Yun and Guo Hong focus on the legal validity and practical risks of a target company providing a guarantee for the repurchase obligations of its actual controller or major shareholder in private equity fund repurchase transactions. Combining the Company Law and the Supreme People's Court's Judicial Interpretation on the Guarantee System, the article points out that the core issue of such guarantees lies in whether the shareholders' meeting resolution procedure has been followed and whether the interests of the company and its creditors are harmed. Judicial practice adopts a cautious and approving attitude toward this. In practice, cases of guarantee invalidity frequently arise due to missing resolutions, procedural defects in signing, or failure to re-pass resolutions in post-investment supplementary agreements. Accordingly, the article recommends that investors strictly obtain shareholders' meeting resolutions before investment, verify the conditions precedent for disbursement, and re-comply with resolution procedures whenever repurchase terms are amended post-investment. Additionally, investors should strive to have the legal representative sign the guarantee documents. In the event the guarantee is found invalid, investors may still claim that the company bears compensation liability not exceeding one-half of the portion of the debt that the debtor cannot discharge, thereby maximizing the protection of the fund's exit path.
Supervisors Under the New Company Law Series on Directors, Supervisors and Senior Executives: The Name and Reality, Powers and Responsibilities of Supervisors
Attorney KE Cheng systematically examines the "name versus reality" and "powers versus responsibilities" of the company supervisor system under the 2024 New Company Law. The article points out that the supervisor system is designed to address the agency problem arising from the separation of ownership and management. Although the New Company Law introduces an audit committee alternative mechanism and allows small-scale companies to dispense with supervisors upon unanimous consent, the traditional supervisor system still holds practical value for most companies. In terms of exercising powers, the New Company Law clarifies statutory authorities such as financial inspection and performance supervision, but in practice, these are often difficult to implement due to challenges in obtaining information and lack of shareholder support. To promote substantive supervision, restrictions on major shareholders' appointment rights, protection of supervisors' right to information, and detailed supervision priorities are needed. Regarding liability, the New Company Law stipulates supervisors' asset custody, loyalty, and compliance duties, but the boundaries of liability remain general and need to be determined based on specific circumstances and judicial practice. The article concludes that the effective operation of the supervisor system depends not only on further improvement of legislative provisions but also on enhanced corporate autonomy and improved oversight mechanisms for minority shareholders.
Key Points of Judicial Review of Administrative Self-Correction Actions — Taking the Case of Huang v. A Township People's Government in Shanghai (Dispute over Revocation of Decision Not to Impose Penalty) as an Example
Attorney YAO Shu uses the case of "Huang v. A Township People's Government (Dispute over Revocation of Decision Not to Impose Penalty)" to explore the judicial review standards for administrative self-correction actions. When reviewing administrative self-correction actions, courts should focus on three key points: First, the principle of due process — the administrative agency must inform the counterparty of the facts to be corrected in advance and guarantee their right to present statements and defenses. Second, the principle of sufficient factual basis — the administrative agency bears the burden of proving that the original decision was indeed erroneous; it cannot arbitrarily revoke an effective decision based solely on differences in re-inspection data or without clear evidence. Third, the principle of proportionality — comprehensive consideration should be given to the counterparty's fault, reliance interest protection, and public interest to prevent abuse of power. If the self-correction action violates procedural requirements, lacks sufficient evidence, or involves clearly improper discretion, the court should revoke it according to law to protect the legitimate rights and interests of the administrative counterparty and maintain the stability of administrative legal relations.
LiDAR Giant Hesai Technology Loses Lawsuit Against U.S. Government: Judgment Logic Raises Global Corporate Compliance Alarms
Attorneys OU Yingshi and PAN Yetong note that in July 2025, the U.S. District Court for the District of Columbia dismissed Hesai Technology's lawsuit against the U.S. Department of Defense (DoD), supporting the DoD's inclusion of Hesai Technology on the 1260H 'Chinese Military Companies' list and ruling that it did not violate the Administrative Procedure Act (APA). The court held that LiDAR technology possesses dual-use (military and civilian) attributes, and because the company is located in a government-recognized 'military-civil fusion' industrial park, it met the statutory criteria of being a 'military-civil fusion contributor' and a 'contributor to the defense industrial base.' The DoD's determination was supported by substantial evidence, and the procedures did not cause substantive prejudice to Hesai. Hesai Technology strongly opposed the judgment, emphasizing that its products are strictly for civilian use with no military ties, and has appealed to the Federal Court of Appeals. This ruling highlights the DoD's broad discretionary power in military-related determinations. Being added to the list subjects a company to severe consequences, including bans on U.S. defense contracts, OFAC sanction risks, Military End User (MEU) designation, and reputational damage. The article warns that this standard—substituting 'actual military supply facts' with 'potential military use'—could broadly affect multinational tech companies operating in China, advising relevant enterprises to closely monitor compliance developments and actively defend their rights through administrative petitions or judicial litigation.
Construction and Analysis of the Right of Commercialization of Personality Identifiers — Taking the "Jordan Case" as an Example
Currently, China's protection of the commercial value of personality identifiers suffers from fragmented legal provisions, a primarily post-event relief approach,模糊 compensation standards, and inconsistent judicial adjudication standards. The root cause is the lack of an independent right of commercialization of personality identifiers. Creating such a right would help separate the property attributes from the personal attributes of人格 rights, establish unified pre-event licensing and transfer rules and post-event property damage compensation rules, and clarify judicial determination standards, thereby providing rights holders with stable legal expectations and fully realizing the commercial value of personality identifiers.
Research on Divorce Parties' Requests to Revoke Divorce Agreement Provisions
Introduction: Generally speaking, a divorce agreement is a mutual expression of will voluntarily reached by a couple after deciding to part ways. It typically covers the divorce decision, property division, child custody, and handling of other debts and claims. Once signed and filed with the civil affairs department, it binds both parties. In real life, for various reasons, it is not uncommon for one or both parties to find the agreement unreasonable and request revocation. So what do the relevant laws say, and how is this reflected in judicial practice?
BIS Entity List Update: Over Half of Newly Added Entities Are Chinese Entities
Attorneys Ou Yingshi and Pan Yetong opine that the U.S. Department of Commerce's Bureau of Industry and Security (BIS) issued a final rule effective September 12, 2025, adding 32 entities (over half of which are entities from Mainland China and their overseas branches) to the Entity List. The newly added entities were determined to threaten U.S. national security and foreign policy interests primarily due to their involvement in military applications, advanced semiconductors and computing, quantum technology, biotechnology research, and the illegal transshipment of items to sanctioned countries such as Russia and Iran. After being added to the list, the relevant enterprises must apply for licenses for exports of items subject to the Export Administration Regulations (EAR), and face a "presumption of denial" or "case-by-case review"; some entities are subject to additional Footnote 3/4 restrictions, extending the scope of controls to foreign-produced items incorporating U.S. technology. This update precisely targets key areas such as semiconductors, biotechnology, aerospace remote sensing, and industrial software, and strengthens efforts to combat circumvention through third-country transshipment. In the short term, it will cause supply chain disruptions for the affected entities and force technological self-reliance and substitution; in the long term, it will raise global compliance costs. Future U.S. technology controls on China are expected to become more precise, and emerging technology fields are likely to become key targets.
Legal Analysis of Copyright Protection for AI-Generated Lyrics and Music
Introduction: With the rapid development of AI technology, AI music creation has become a reality. This transformation not only overturns traditional music industry models but also brings a series of new legal issues. This article aims to explore whether AI-generated lyrics and music should be protected by copyright law, existing legal risks, and possible protection approaches. Traditional music creation involves lyricists, composers, and performers, whose copyright includes a series of basic rights such as publication rights, attribution rights, and reproduction rights.
New Smuggling Trends and Criminal Risk Prevention After Hainan's Customs Closure
On December 18, 2025, the entire island of Hainan Free Trade Port will officially begin closed customs operation. After the closure, the "first-line liberalization, second-line control" policy will be implemented. The list of zero-tariff items will significantly increase to nearly 6,600. Processed products with 30% value-added will be exempt from tariffs when sold to the mainland. The scope of beneficiaries will be comprehensively expanded, import restrictions will be relaxed, and bonded maintenance will be opened. While improving trade facilitation, the new policies will also give rise to new smuggling risks, mainly including intensified "daigou and arbitrage" of zero-tariff goods, falsely reporting processing value-added ratios to obtain tariff exemptions, misreporting or concealing prohibited/restricted goods, illegally smuggling zero-tariff goods out of the island, and using "three-no" vessels or cruise ships/yachts for smuggling. Individuals should enhance their awareness of prevention and refrain from lending duty-free quotas or participating in "daigou and arbitrage." Enterprises need to establish sound compliance and internal control mechanisms, strictly account for processing value-added data, dynamically track lists of prohibited/restricted items, ensure traceability of goods' trajectories, carefully choose transportation means, and appropriately handle customs audits by utilizing lenient policies such as voluntary disclosure.
Analysis of the Zong Family Trust Dispute: An In-Depth Interpretation from the Perspective of Hong Kong Trust Law
Attorney LIANG Hongxuan and HUANG Enlin provides an in-depth analysis of the Hong Kong High Court's judgment on asset preservation and disclosure orders in the Zong Qinghou family trust dispute ([2025] HKCFI 3355). Although this case involves a procedural ruling with substantive proceedings to be conducted in Mainland China, it comprehensively demonstrates the flexible application of common law trust principles in determining nominee holding relationships, constructive trusts, the "three certainties" standard, and the "capital preservation trust" structure. The article重点 argues the innovative application of Section 21M of the Hong Kong High Court Ordinance in cross-border interim relief, highlighting Hong Kong's procedural advantages over Mainland China in preservation mechanisms and its ability to balance jurisdictional power. Combined with Hong Kong's mature common law trust tradition, modernized Trustee Ordinance, low-tax advantages, and independent professional judicial environment, this case not only provides important precedent guidance for complex cross-border family wealth传承 and asset protection but also fully demonstrates Hong Kong's institutional advantages and strategic value as an Asian trust center, offering highly certain legal solutions for high-net-worth individuals to achieve wealth security, risk isolation, and跨 jurisdictional rights maximization.
Hong Kong's Stablecoin Ordinance: HKD 25 Million Registered Capital + Full-Process License Control, Digital Finance Rules Set for Reshaping!
Hong Kong's Stablecoin Ordinance came into effect on May 30, aiming to fill the regulatory gap for virtual assets through comprehensive chain-wide compliance controls. The core of the Ordinance lies in establishing a strict licensing system, requiring issuers to have a minimum paid-up capital of HKD 25 million, implementing 100% independent segregation of reserve assets with redemption at par value at any time, and mandating compliance requirements such as anti-money laundering reviews, periodic audit disclosures, and prohibition of interest promises. The enactment not only effectively prevents financial and money laundering risks and protects investor rights but will also promote the sustainable development of the stablecoin industry on a compliant track, consolidate Hong Kong's status as an international financial center, and set a benchmark for global stablecoin regulation. Future applications are expected to deepen in areas such as cross-border payments and digital finance, while promoting international regulatory coordination.
Series on Directors, Supervisors, and Senior Management Under the New Company Law (Part V): Potential Legal Risk Prevention and Control for Senior Management Resignation
Attorney KE Cheng, combining the 2024 new Company Law and labor law practice, systematically reviews the legal risks and prevention pathways for senior management resignation. It first analyzes the conflict between the board's no-cause dismissal power under company law and the for-cause termination of labor relationship under labor law, proposing a coordination solution by transforming senior management's fiduciary duties into lawful grounds for termination. Second, regarding voluntary resignation, it highlights risks and countermeasures concerning trade secret infringement, non-compete obligations, post-resignation invention ownership disputes within one year, and issues related to issuance of resignation certificates and工商 registration changes. Finally, for unilateral dismissal by the company, it clarifies specific measures to prevent courts from ordering continued performance of labor contracts, high compensation due to evidentiary defects, and senior management's refusal to return company seals and assets, recommending that companies improve internal controls, standardize dismissal procedures, and preserve evidence in advance, providing compliance guidance for practical operations.
U.S. Initiates 'AD/CVD' Investigations on Photovoltaic Products from Laos, Indonesia, and India: How Should Enterprises Respond?
Attorneys OU Yingshi and HUANG Enlin note that on July 16, 2025, the American Alliance for Solar Manufacturing and Trade (AASMT) submitted a petition to the U.S. Department of Commerce (DOC) requesting the initiation of anti-dumping and countervailing duty (AD/CVD) investigations into photovoltaic products originating from Indonesia, Laos, and India. This petition was prompted by Chinese photovoltaic companies transferring production capacity to these three countries to circumvent high U.S. tariffs on Southeast Asian nations. The investigation primarily targets crystalline silicon photovoltaic cells and modules, laminates, and panels with a thickness of ≥20 micrometers, alleging that companies in these three countries engaged in dumping and enjoyed multiple government subsidies such as tax exemptions, and underpriced land and electricity supply. The period of investigation is from July 2024 to June 2025. The U.S. procedures are expected to be initiated in August 2025, with the investigation and determination process expected to last until the second half of 2026. This investigation will have a significant impact on Chinese photovoltaic export enterprises. It is recommended that relevant companies improve their cross-border compliance systems in advance, closely monitor the progress of the investigation, and actively respond to the investigation with the assistance of lawyers to cope with the potential risk of high tariffs.
In-Depth Interpretation of 2025 New Rules on Refusal to Execute: A Complete Guide from Public Prosecution Transfer to Private Prosecution
Introduction: The '2025 Opinions on Handling Criminal Cases of Refusal to Execute Judgments and Rulings' (Fa Fa [2025] No. 8), newly issued by the Supreme People's Court, Supreme People's Procuratorate, and Ministry of Public Security, officially came into effect on July 1, 2025. This document directly addresses the 'difficulty in enforcement' issue in practice and systematically clarifies the specific division of labor and procedures among public security organs, procuratorates, and courts in handling cases of refusal to execute judgments and rulings (hereinafter referred to as 'refusal to execute crimes').
The GENIUS Act Arrives: What Changes Await the Stablecoin Market?
The U.S. Senate has passed the GENIUS Act, aimed at regulating the rapidly growing stablecoin market. The Act brings "payment stablecoins" under regulatory oversight, stipulating that only licensed bank subsidiaries or qualified state/federal issuers may issue them, implementing a "state + federal" dual-track system. Core requirements include: stablecoins must be 100% backed by low-risk assets such as U.S. dollar cash and short-term Treasury bonds; issuers must strictly disclose reserve composition and redemption policies, and undergo regular audits; stablecoin holders enjoy priority repayment rights in bankruptcy liquidation; business scope is restricted and misuse of user data is strictly prohibited; issuers are subject to the Bank Secrecy Act, with enhanced anti-money laundering compliance, and non-compliant foreign stablecoins are strictly restricted from entering the U.S. The Act is expected to enhance market transparency, protect investor rights, and consolidate the dollar's position, but high compliance costs may increase market concentration, sparking debate on balancing financial innovation and risk regulation.
In-Depth Analysis of the UK's Latest Sanctions Compliance Guidance: How Chinese Enterprises Can Respond to New Cross-Border Compliance Challenges
Attorneys OU Yingshi and PAN Yetong note that on June 27, 2025, the UK Foreign, Commonwealth and Development Office published a sanctions compliance guidance for non-UK businesses, aiming to help third-country enterprises identify and avoid circumventing UK sanctions against Russia. The guidance clarifies typical circumvention scenarios, such as indirect shipments and concealing end-users, and points out that if non-UK enterprises participate in circumvention activities or have specific links to the UK, they will face severe consequences such as asset freezes and loss of international cooperation opportunities. UK sanctions against Russia mainly cover financial sanctions (freezing the assets of designated persons) and trade sanctions (embargoes on goods and restrictions on services). The guidance suggests that Chinese enterprises strengthen pre-transaction due diligence and 'red flag' screening, establish a compliance management system encompassing high-level coordination, contractual constraints, and dynamic monitoring, and continuously follow updates to the UK sanctions list to effectively mitigate compliance risks.
Key Points for Customs Intellectual Property Recordation That Enterprises Must Know from the "Going Global" Perspective
Against the backdrop of accelerated overseas expansion by Chinese enterprises, customs intellectual property recordation has become a core tool for protecting independent brands and preventing cross-border infringement risks. This article systematically elaborates on the strategic value of customs recordation, including enabling dynamic supply chain management, leveraging customs ex officio enforcement to actively intercept infringing goods, and providing key evidence for subsequent administrative, criminal, or civil proceedings. The article details the application process, required materials, ten-year validity period with renewal mechanism, and measures for confiscation and destruction of goods after customs seizure. It also provides preventive recommendations for common practical issues such as incomplete materials, inaccurate authorization information, and dealing with seizure time limits. Overall, customs IP recordation offers high efficiency and low cost. Enterprises should combine regular infringement monitoring with professional management to build a solid cross-border brand moat and comprehensively protect their overseas commercial interests.
Analysis of Key Points in Criminal Complaints for the Crime of Infringing on Trade Secrets
Attorney Gao Peijie, drawing on the Criminal Law Amendment (XI) and the latest judicial interpretations, systematically analyzes the key practical points for criminal complaints regarding the crime of infringing on trade secrets. The article points out that China's trade secret protection regime has become stricter, the threshold for criminalization has been lowered, and criminal case filings no longer require actual substantial losses as a prerequisite. Complaints must focus on four core elements: First, the identification of trade secrets, which requires simultaneous satisfaction of secrecy, commercial value, and reasonable confidentiality measures. Second, the determination of identity, which can be proven through judicial appraisal or the "contact + similarity" principle to demonstrate that the infringing information is substantially identical to the trade secret. Third, the identification of conduct, encompassing acquisition through improper means such as theft, bribery, electronic intrusion, etc., as well as disclosure, use, or authorization of use in violation of confidentiality obligations. Fourth, the calculation of losses and prosecution standards. The current filing threshold is losses or illegal gains of at least 300,000 RMB, which can be established through reasonable licensing fees, profit losses, or system remediation costs, supported by professional appraisal reports. Clarifying these key points helps improve the success rate of criminal filings, effectively combat infringement, and strengthen intellectual property protection and innovation ecosystem development.
Practical Key Points of Cryptocurrency Division in Divorce Litigation
Introduction: On May 22, 2025, the value of a single Bitcoin exceeded $110,000 for the first time, reaching a historic high. With the significant growth of the global crypto asset market, cryptocurrencies represented by Bitcoin have increasingly become an important option for personal asset allocation for certain groups. In divorce litigation in Mainland China, how to define, identify, evaluate, and divide this new type of property rights has become a complex issue that urgently needs clarification in judicial practice.
Practical Application of Insurance Trusts in Wealth Inheritance for High-Net-Worth Individuals
Attorney LI Dingbang systematically explores the application of insurance trust in wealth management. It first introduces the development background, establishment threshold, and regulatory status of insurance trusts, comparatively analyzing domestic Models 1.0 to 3.0 and operational mechanisms in the US, Japan, and Taiwan. Second, it elaborates on the core advantages of this instrument in tax planning, asset segregation from creditors, professional asset management, and flexible distribution. Then, drawing on practical cases, it identifies existing legal gaps in preventing beneficiary moral hazard, arrangements for the settlor's incapacity or incompetence, and post-mortem estate management, proposing comprehensive planning through supporting legal tools such as agreed guardianship and notarized wills. Finally, it emphasizes that the commercial optimization of insurance trusts requires cross-industry collaboration, and lawyers should play a key role in legal structure design and personalized wealth inheritance planning.
What Liability Do Shareholder Liquidation Obligors Bear for Failing to Notify Creditors During the Liquidation of an LLC?
Lawyers Li Yanqiu and Jiang Yuting discuss the scope of liability for compensation when shareholders of a limited liability company fail to perform their notification and public announcement obligations during liquidation. Addressing three practical viewpoints—"bearing liability for all unpaid claims," "bearing liability limited to the remaining assets of the company," and "bearing liability limited to the capital contribution"—the authors support the first viewpoint based on typical cases and legal analysis. The article points out that where shareholders know of the existence of debts but fail to perform their notification obligations and issue false liquidation reports, such conduct constitutes an abuse of the corporate independent status and shareholders' limited liability, and the system of piercing the corporate veil should be applied to impose joint and several liability for compensation. Meanwhile, the debt commitment made during deregistration constitutes a parallel debt assumption. Therefore, the shareholder liquidation obligors should bear liability for compensation for the entire unpaid claims of the creditors, without being limited to their capital contributions or the company's remaining assets. Shareholders of a one-person limited liability company must also bear equivalent liability if they cannot prove the independence of their assets.
Top 10 Essentials for the Safe 'Overseas Expansion' of Cross-Border E-Commerce
Attorney YE Peng systematically outlines the developmental opportunities and compliance guidelines for Chinese cross-border e-commerce enterprises expanding overseas. The article first distinguishes between cross-border e-commerce and traditional foreign trade, and analyzes the industry's growth prospects. Subsequently, it provides practical advice on choosing mainstream platforms, configuring logistics models, customs declaration, and tax refund processes for overseas warehouses. Meanwhile, it offers a detailed interpretation of the Chinese government's latest supportive policies, as well as the regulatory and tax requirements of key markets such as the US, the EU, and Southeast Asia. Finally, addressing the multiple risks faced by sellers in their operations—including policy, logistics, payment, and intellectual property—the article proposes core strategies such as brand building, localized operations, and tax and data compliance. The aim is to provide comprehensive guidance for enterprises to expand into overseas markets safely and efficiently.
Analysis of Cross-Regional Judicial Jurisdiction Models in Administrative Litigation Cases and Practical Tips for Lawyers
Introduction: The traditional model of administrative litigation jurisdiction based on the location of the defendant's administrative entity has been questioned for potentially lacking impartiality due to possible local administrative interference. Therefore, reforms exploring cross-regional judicial jurisdiction for administrative litigation cases have emerged. Courts across the country have exercised local judicial initiative, actively implementing models such as centralized jurisdiction and异地审理 (hearings in different locations), which have not only strengthened judicial supervision over administrative power and optimized the allocation of judicial resources, but also enhanced public trust in administrative trials. This represents an important measure in the modernization of China's judicial system.
Practical Research on Arbitration Judicial Review (Part 3): A Comparative Study of the Similarities and Differences Between Applications for Revocation of Arbitration Awards and Applications for Non-Enforcement of Arbitration Awards, and Issues Concerning System Articulation
Introduction: Generally speaking, domestic arbitration is divided into commercial arbitration and labor dispute arbitration. This series of articles on practical research into arbitration judicial review only explores commercial arbitration, namely arbitration arising from 'contract disputes and other property rights disputes between citizens, legal persons, and other organizations as equal subjects' as stipulated in Article 2 of the 'Arbitration Law of the People's Republic of China' (hereinafter referred to as the 'Arbitration Law').
Development and Exploration of Civil Litigation for Bond Misrepresentation – Observations Based on Past 10 Cases
Attorney Lai Guanneng, based on ten typical cases of bond misrepresentation lawsuits in China, systematically reviews the core adjudication rules and development trends of such cases. In terms of legal application, judicial authorities have uniformly applied the Securities Law and the Judicial Interpretation on Misrepresentation to both exchange and interbank markets, public and private placement bonds, and asset-backed securities. Regarding liability, as defaulting issuers have often lost their solvency, investors' litigation focus has shifted to intermediaries such as underwriters and auditors. Court judgments have become increasingly refined, generally adopting "proportional joint and several liability" based on the degree of fault. The calculation of investor losses faces significant controversy between "face value principal and interest" and "investment difference," with practice mostly using face value principal and interest as the benchmark but lacking a unified standard. Additionally, the plaintiff's own fault may mitigate the defendant's赔偿责任, and after the issuer enters bankruptcy proceedings, its debts are handled within the bankruptcy liquidation, and bankruptcy repayment amounts or non-cash settlement plans can generally offset or terminate recourse against other joint and several obligors. Overall, China's bond misrepresentation trials are becoming more specialized and refined, but core disputes such as loss calculation still await further clarification in judicial practice.
Facing the Recent U.S. Tariff Policies, How Can Chinese Cross-Border E-Commerce Break Through?
Attorney Ye Peng argues that the recent U.S. cancellation of duty-free treatment for low-value parcels from China, the abolition of the T86 customs clearance procedure, and the substantial imposition of 'reciprocal tariffs'—with cumulative rates once reaching as high as 145%—have subjected Chinese cross-border e-commerce enterprises to severe challenges, including soaring costs, compressed profits, declining competitiveness, and forced market exit. In response, enterprises should actively leverage policy benefits such as the national overseas warehouse construction, export tax rebates, and tax incentives under comprehensive pilot zones while accelerating cooperation with domestic platforms like JD.com and Hema to expand domestic sales channels. Strategically, it is recommended to negotiate tariff cost sharing with U.S. firms, implement market-differentiated pricing, shift production to Southeast Asia to optimize supply chains, diversify into European, American, and emerging markets to mitigate single-market risk, while intensifying product innovation and environmentally differentiated R&D, and deeply applying big data and artificial intelligence technologies to optimize marketing and customer service processes—thereby achieving a breakthrough and sustainable growth amidst the complex international trade environment.
Compliance Guide for Employer Termination of Labor Contracts on Grounds of Incompetence
Attorney LI Jupeng and DU Meili provides guidance on the compliant operation of terminating labor contracts on the grounds of "incompetence." Under the Labor Contract Law, such termination must strictly follow the three-step statutory process: "first proof of incompetence — training or job transfer — second proof of incompetence." In practice, specific quantifiable assessment indicators must be set and confirmed by the employee. Training must be targeted, job transfers must meet reasonableness and legality standards, and a Performance Improvement Plan (PIP) without embedded training content does not constitute lawful training. The article clearly states that "elimination of the last-place employee" is not equivalent to incompetence and cannot be used as a basis for unilateral termination. Given the high legal risk and strict evidentiary requirements of this type of termination, employers must maintain complete records throughout the process, pay economic compensation in accordance with law, and fulfill notice obligations. It is recommended that such terminations be carried out under the guidance of professional legal counsel to ensure compliance.
A Brief Discussion on the Impact of U.S. Export Controls and Sanctions on Enterprises in China's Low-Altitude Economy Sector
Attorney PAN Yetong notes that in recent years, citing 'national security' and other reasons, the U.S. Department of Commerce's Bureau of Industry and Security (BIS) has continuously strengthened export controls and sanctions on China's low-altitude economy sector (including drones, eVTOLs, and related components and software). Key measures include adding multiple major enterprises to the Entity List with a presumption of denial for license reviews, imposing massive fines on violating companies, and introducing new rules to tighten control over the drone supply chain. These control measures exercise long-arm jurisdiction through the 'De Minimis Rule' and the 'Foreign Direct Product (FDP) Rule,' causing Chinese enterprises to face severe challenges such as the risk of broken core component supply chains, hindered product upgrades, restricted access to specific markets, and significantly increased compliance costs. In response, the article suggests that enterprises strengthen component screening and supply chain management, strictly screen customer backgrounds and end-uses, enhance overall compliance awareness, and dynamically track regulatory changes. Concurrently, leveraging professional legal teams to navigate export control risks is recommended to ensure robust business development.
The Impact of Tencent's Inclusion on the 'Chinese Military Companies' List and the Reference Value of the Xiaomi Case
Attorney CHEN Shaoping notes that in January 2025, the U.S. Department of Defense released the latest 'Chinese Military Companies' list, adding 134 enterprises, including Tencent and CATL, nearly doubling the size from the previous year. Tencent quickly issued a statement claiming the inclusion was erroneous, announced plans to initiate administrative reconsideration and litigation procedures, and emphasized that the designation would not substantially impact its core business. Despite this, Tencent's stock price still plummeted by about 10%. This list, spearheaded by the U.S. DoD, ostensibly aims to identify and counter China's Military-Civil Fusion strategy supporting the PLA's modernization. In reality, it serves as a tool to stifle the technological advancement of Chinese enterprises in critical fields such as artificial intelligence, aerospace, and advanced materials. Drawing on the precedent set by Xiaomi's listing in 2021, this article systematically analyzes the purpose, listing criteria, and practical impacts of the list, and explores the feasibility of Chinese enterprises appealing for removal through legal channels.
Application of Anti-Suit Injunctions in Hong Kong Matrimonial Litigation and Case Analysis
Introduction: Cross-border marriages are now very common. When divorcing parties initiate divorce proceedings in different jurisdictions, issues of jurisdiction conflict may arise. Regarding whether Hong Kong courts have jurisdiction over a divorce case, according to Section 3 of the Matrimonial Causes Ordinance (Cap. 179) of Hong Kong laws, Hong Kong courts have jurisdiction over divorce proceedings under that Ordinance in the following circumstances: 1. On the date when the petition or application is made, any party to the marriage has Hong Kong as their domicile; 2. During the whole period of three years immediately preceding the date when the petition or application is made, any party to the marriage has been ordinarily resident in Hong Kong; 3. On the date when the petition or application is made, any party to the marriage has a substantial connection with Hong Kong.
Paths and Methods for Resolving Labor Disputes: Facts, Reasons, Value Judgments, and Interest Balancing
Introduction: Labor disputes are inevitable issues in social and economic development, and their handling requires following certain paths and methods. This article conducts an in-depth discussion on the four-step method for handling labor disputes, namely fixing facts, stating reasons, value judgments, and interest balancing, aiming to provide theoretical support and practical guidance for the proper resolution of labor disputes. The handling of labor disputes concerns the vital interests of both workers and employers and affects social stability and harmony.
From Three Olds Renovation to Urban Renewal: A Study on the Rule-of-Law Strategy for Transformation of Village-in-City Renovation Models
Attorney Chen Gonghui and Luo Yunyu systematically review the evolution of Guangzhou urban renewal policies, analyzing the practical characteristics of four typical renovation models.
Analysis of the Determination Elements of False Equity Transfers in Judicial Practice
Attorney QIU Shaoming explores the criteria for determining false equity transfers in judicial practice, pointing out that courts tend to characterize such conduct as "collusive虚假 expression" rather than "malicious collusion," and litigation strategies should prioritize the former. Combining typical cases, the article summarizes the core external evidence and review dimensions used by courts to determine "collusive虚假 expression": inconsistency of expression of intent between different contracts (especially the transfer price); the关联 relationship between parties as初步 evidence of collusion; absence of standard procedures in contract formation (e.g., no negotiation or due diligence); abnormal performance (e.g., no actual payment or takeover);关联 conduct before and after the transfer (e.g., transfers in name but guarantees in substance, or临近 litigation); and significantly unreasonable transfer prices. The study emphasizes the importance of typological analysis of false equity transfers in guiding case adjudication and litigation strategy formulation.
Commercial Lease Dispute Practice – The Lessor's Strategy in Lease Disputes
Attorneys Qiu Shuning and Wu Yun discuss the remedies available to lessors in commercial lease disputes when the lessee breaches the contract by early termination and vacates the premises. A commercial lease is a continuing contract. When a contractual impasse arises, judicial practice generally does not support the lessor's claim for specific performance, and the breaching party may also seek rescission of the contract through litigation. The lessor's focus in asserting rights should shift to damages for breach of contract, including overdue rent, compensation for use and occupation after the due date, liquidated damages, and property damage. Using a group lease case as an example, the article points out that the time of contract rescission, the occupation fees arising from defects in the partial return of the shop premises, and the amount of liquidated damages are all influenced by the specific circumstances of each case and the discretion of the judge. Finally, it recommends that lessors avoid rigidly insisting on specific performance, promptly take over the premises to fulfill the duty to mitigate losses, and actively preserve records of communication and evidence of losses during negotiations to effectively respond to subsequent litigation.
Technical Secrets vs. Patents: Which Path Should Corporate IP Protection Strategy Take?
Attorney Guo Shuai systematically compares the similarities and differences between technical secrets and patents in intellectual property strategy. The article first defines the legal concepts and constitutive elements of trade secrets and technical secrets, and outlines the full lifecycle of patent application, grant, validation, and enforcement. On this basis, it conducts an in-depth analysis of the differences between the two from four stages: right formation, confirmation, exercise, and infringement defense. Patents exchange technical disclosure for a limited monopoly, emphasizing novelty, inventiveness, and practical applicability, with validation dominated by administrative authorities, and infringement determined by the all-elements rule. Technical secrets focus on confidentiality measures and continuous protection, with validation relying on judicial proceedings and a partial shift in the burden of proof, and infringement determined by the standard of substantive identity of technical solutions. The conclusion points out that although the protection period of technical secrets is indefinite, enterprises have stronger control and higher manageability; enterprises should flexibly formulate a combination or selection strategy of patents and technical secrets based on the characteristics of core technologies and market competition needs, so as to maximize the protection of innovation achievements.
Lawyer Practice in Due Diligence for AI Medical Projects
Official guidance documents from the National Medical Products Administration have already allowed AI to be used in assisted decision-making for medical behaviors such as lesion nature, medication, and treatment, as well as some procedural non-assisted decision-making, but emphasis is placed on reviewing the compliance of data sources, the reasonableness of data distribution, validity, and accuracy. The U.S. Food and Drug Administration (FDA) is also gradually improving the approval process for AI medical products, which brings more standardized guarantees to the industry and provides broad application space for legally compliant AI medical technology.
Insights into New Trends of Strengthened Judicial Protection of Trade Secrets — Comment on the Supreme People's Court's First Case on New Energy Vehicle Technical Secrets
Lawyer Qiu Shaoming believes that on June 15, 2024, the Supreme People's Court issued a second-instance judgment in a new energy vehicle technical secret infringement case, with a total compensation amount of approximately 640 million yuan, setting a historical high. This judgment clarifies two core rules for strengthening judicial protection of trade secrets: first, optimizing the allocation of the burden of proof. Pursuant to Article 32 of the Anti-Unfair Competition Law, the court adopts holistic analysis and comprehensive judgment, significantly reducing the burden of proof on the right holder and directly presuming infringement; second, improving the determination of damages. Where the actual losses of the right holder are difficult to calculate, the court uses the gross profit margin of representative enterprises in the same industry as a reference, calculates the infringer's gains based on the R&D costs saved by the misappropriation of technology, and applies punitive damages in accordance with the law. Additionally, the judgment innovates the form of liability for cessation of infringement by clearly specifying a daily penalty for delayed performance. This case fully reflects the continuous intensification of trade secret protection in China's judicial practice and has important guiding significance for maintaining industrial chain security and incentivizing technological innovation.
After the 'Pay-If-Paid' Clause Ruling: How Should General Contractors Respond?
Following the Supreme People's Court publishing three back-to-back clause judicial cases on July 26, 2024, the Supreme Court issued a judicial interpretation on August 27, 2024, on the validity of terms where large enterprises agree that payment is conditioned on third-party payment when contracting with SMEs. This article examines the background and practical implications for general contractors.
Overview of Laos Investment Law and Risk Prevention (I)
With its advantageous geographical location and role as a node in the "Belt and Road" initiative, Laos has become an important destination for Chinese enterprises investing in Southeast Asia, focusing on energy, mining, agriculture, and infrastructure. This article systematically reviews the core legal and practical framework for foreign investment in Laos: foreign investors may establish enterprises through joint ventures or wholly-owned forms, with 100% shareholding generally permitted except in specifically restricted industries; Special Economic Zones offer multiple policy incentives including corporate income tax reductions, long-term land leases (up to 99 years), customs duty exemptions, and one-stop administrative services; concession activities mainly target large-scale infrastructure and resource development projects, requiring feasibility assessments, agreement signing, and other statutory procedures; intellectual property is comprehensively protected under the 2023 revised Intellectual Property Law, covering trademarks, patents, industrial designs, and electronic works; labor and employment strictly follow the Labor Law, with clear provisions on working hours, mandatory social insurance, and foreign worker quotas, requiring enterprises to focus on compliance; land is state-owned, and foreign investors primarily obtain usage rights through leases (typically 30-50 years) or concessions, with strategic projects eligible to apply for rent reductions according to law. Overall, Laos's legal system is open to foreign investment with comprehensive supporting incentives, providing Chinese investors with clear policy direction and broad market opportunities.
Risk Analysis and Legal Changes from the Perspective of International Trade
Attorney ZHANG Huimin systematically reviews the transaction models, commercial and regulatory participants, typical import/export processes and corresponding legal risks of international trade, and comprehensively analyzes the multi-layered legal sources consisting of international trade practices, international conventions, standard contracts, and domestic laws of various countries. It focuses on the latest developments in China's international trade legal system, including the complete abolition of foreign trade operation registration to deepen institutional opening up, aligning data compliance and rules with digital trade trends, constructing countermeasure legal frameworks such as export controls and anti-foreign sanctions, and unifying foreign-related adjudication standards through publishing typical cases. The article aims to provide international trade participants with practical references for risk identification, compliance management, and legal response.
Practical Analysis of Patent Freedom to Operate (FTO) and Key Considerations
FTO (Freedom to Operate) analysis is an important non-litigation tool for enterprises to identify patent infringement risks and prevent intellectual property disputes. This article defines the core concept of FTO and its legal significance in avoiding punitive damages, and points out its wide application across various business scenarios including product R&D, launch, IPO, production line introduction, and market expansion. It further details the standard FTO operation procedure, covering five major steps: technical research, patent search, screening, infringement comparison, and strategy formulation. The article also emphasizes the comprehensive professional capability requirements from technical, patent, legal, and economic dimensions. It concludes that FTO is an effective risk management tool for businesses, but its specific defensive effect in domestic patent litigation still awaits further judicial practice.
The Impact of the "Interpretation of the General Provisions of the Contract Book of the Civil Code" on Banking Operations
Attorneys Liu Hui and Li Lin systematically analyze the impact of the "Interpretation of the General Provisions of the Contract Book of the Civil Code" on banking operations and provide compliance recommendations. Key points include: ambiguous third-party credit enhancement commitments are easily deemed as gratuitous contracts and interpreted in favor of the debtor; the content of a cooperation framework agreement directly determines whether it qualifies as a preliminary or formal contract; banks must perform a duty to explain standard terms in a plain and understandable manner and improve electronic contracting processes; in criminal-civil交叉 scenarios, contracts are not necessarily invalid, which benefits protecting innocent financial institutions; contract signing requires enhanced review of the identity and authority of handlers to prevent unauthorized agency and employee "fly-order" risks; issuance of invoices is an ancillary obligation and must be explicitly agreed upon as a precondition for payment; in debt-for-asset swaps, banks have the right to choose upon default, but mediation documents do not directly have real rights effects, requiring timely registration; subrogation and revocation actions are not excluded by arbitration clauses, and clear criteria for "obviously unreasonable prices" are established, facilitating banks' rights protection. Overall, banks are advised to optimize contract texts and strengthen internal authorization management and compliance review.
Analysis of the Division of Precious Metals and Jewelry in Divorce Disputes
I. Introduction: Setting aside the rising price of gold, precious gemstones such as jade and pearls have become popular choices for daily wear, collection, and investment. The core considerations for whether precious metals and jewelry can be divided as marital property in divorce disputes primarily involve two aspects: first, determining the timing of acquisition; second, whether the items possess significant personal exclusivity. Based on this, this article explores the division of precious items acquired before and after marriage in divorce disputes, using the establishment of the marriage relationship (i.e., marriage time) as the dividing point.
Analysis of Enforcement Difficulties After Default of Sino-Offshore USD Bonds
Attorney CHEN Yiqian and LIN Jinghuan and CHENG Jingda, based on typical 2023 judgments from the Cayman Islands, Hong Kong, and BVI concerning defaults on sino-offshore USD bonds, systematically analyzes whether bond investors (especially indirect investors holding beneficial interests through clearing platforms) have the standing to directly file winding-up petitions against the issuer after default. The Cayman and Hong Kong courts both adopted a negative stance, finding that investors only have economic interests rather than direct contractual rights, do not qualify as statutory "creditors" or "contingent creditors," and cannot derive authorization from platform operating rules alone—strictly requiring adherence to the集中 exercise mechanism stipulated in the issuance documents. In contrast, the BVI court reached a different conclusion, based on a broader definition of "creditor" under local insolvency law and consideration of commercial reality, recognizing investors' direct standing. The article emphasizes that the divergence in judgments across the three jurisdictions reflects different value trade-offs between contractual certainty, judicial intervention, and passive investor protection, advising practitioners to carefully review governing law, specific issuance document terms, and authorization chains during跨境 bond investment due diligence, and to closely monitor subsequent judicial developments.
Practical Guide to Applying for Recognition of Foreign Court Divorce Judgments in China
Attorney WEN Qiuting and CHEN Qiaodan provides a detailed overview of the process and key points for applying for recognition of a foreign court's divorce judgment in China. The applicant must have at least one party who is a Chinese citizen, and the case shall be under the jurisdiction of the intermediate people's court at the applicant's domicile or habitual residence. The applicant must submit a written application, identity documents, the original foreign divorce judgment, proof of effectiveness, and proof of lawful summons. Relevant documents must be notarized and authenticated or accompanied by an apostille, along with an accurate Chinese translation. The court will decide whether to accept the case within 7 days. The ruling takes effect upon service and cannot be appealed. Recognition will be denied if the judgment is not yet effective, the foreign court lacks jurisdiction, the defendant was not lawfully summoned, the judgment conflicts with a pending or already decided case in China, or violates Chinese law or public interest. The application may be withdrawn or dismissed, but in either case, a new application is barred; the applicant must instead file a separate divorce action in a Chinese court. Notably, China only recognizes the dissolution of the marital relationship in a foreign divorce judgment. Issues regarding property division, child support, and alimony must be resolved through separate litigation in China. Judgments from Hong Kong, Macao, and Taiwan courts are subject to special provisions.
The New Arrangement for Mutual Recognition and Enforcement of Civil and Commercial Judgments Between Mainland China and Hong Kong
The Arrangement signed by the Supreme People's Court and the Hong Kong SAR Government and related supporting documents (Cap. 645 and Rules) took effect on January 29, 2024. This Arrangement establishes a more comprehensive mechanism for mutual recognition and enforcement of civil and commercial judgments between Mainland China and Hong Kong, significantly reducing the cost of repeated litigation and relaxing application standards. It operates in parallel with the existing Cap. 597 rather than directly replacing it. Compared with the old regime, Cap. 645 eliminates the requirement for choice of court agreements, relaxes restrictions on Mainland court levels, changes "final judgment" to "effective judgment," expands the scope to non-monetary judgments, and adopts a negative list model. In practice, Mainland judgments require active application for registration in Hong Kong and are divided into two stages—recognition and enforcement. Applicants should be aware of exceptions, time limits, and should investigate and preserve the judgment debtor's assets in advance.
Key Points of the New Company Law Revisions
The new Company Law, effective July 1, 2024, introduces significant amendments across three dimensions. In protecting minority shareholders' rights, it expands shareholders' right to information (allowing inspection of accounting vouchers and extending to wholly-owned subsidiaries), grants minority shareholders a statutory exit right when controlling shareholders abuse their rights, and lowers the shareholder proposal threshold for joint-stock companies to 1%. In protecting creditors' interests, it requires registered capital to be paid in full within a maximum of 5 years, clarifies the allocation of contribution obligations between transferors and transferees in equity transfers involving unpaid capital, and lowers the threshold for accelerated maturity of shareholder contributions. In corporate governance, it allows audit committees to replace supervisory boards to simplify structures, expands the selection scope of legal representatives and improves resignation and change procedures, while increasing the compensation liability of directors, supervisors, and senior executives for failing to call capital contributions, preventing capital withdrawal, and causing damage in the performance of duties. Relevant enterprises are advised to study the new regulations promptly and make adjustments based on their actual circumstances.
Defense Lawyers' Effective Review and Challenge of Special Audit Reports
Attorney LUO Jie points out that since the Ministry of Justice ceased the registration management of forensic appraisal institutions outside the "four major categories," judicial accounting appraisal has become "nominal in existence." Special audit reports have thus become substitutes for identifying financial issues in criminal trials. There are fundamental differences between the two in terms of business nature, evidentiary basis, and legal effect. Using audit reports as substitutes for appraisal is essentially "passing off inferior as superior." In practice, special audit reports are often wrongly characterized as documentary evidence to circumvent the evidence rules for expert opinions. Common problems include improperly admitting unexamined testimonial evidence, exceeding authority in making legal evaluations, and surreptitiously substituting standards for determining the amount of crimes. Drawing on practical experience, this article systematically proposes defense lawyers' key points for reviewing and challenging special audit reports from seven dimensions: evidence category, subject qualification, entrusted matters, scope of materials, examination methods, audit conclusions, and attachments. It calls on the Supreme People's Court to issue judicial interpretations as soon as possible to clarify the legal status and evidence rules for special audit reports, thereby standardizing criminal evidence review and safeguarding judicial justice.
Legal Effects of Contractual Automatic Termination Clauses
In practice, contracts often include clauses providing for automatic termination upon conditions or timeframes. This article analyzes the legal effect of such clauses, examining whether contractual termination rights require notice, the consequences of non-exercise, and available remedies when termination rights expire.
Trends and Practice of Criminal Compliance Non-Prosecution
The corporate criminal compliance non-prosecution system, originating in the United States, has now deeply aligned with China's high-quality development needs. Currently, this system shows four major trends: the applicable procedures extend to all stages of criminal proceedings; regional coverage continues to improve; the scope of application expands from organizational crimes to individual crimes closely related to production and business activities; and case types extend from minor offenses to major cases. Practical operations follow core steps including: initiation of procedures, submission of compliance commitments and plans, selection of third-party organizations and determination of timelines, enterprise self-inspection with third-party review and competent authority verification, hearing and acceptance, and issuance of non-prosecution decisions. As judicial practice continues to deepen, the scope of application of this system is continuously expanding, with the potential for full national coverage.
Analysis of the Division of Commercial Insurance Property Rights and Interests in Divorce Disputes
Attorney Chen Qiaodan, addressing the lack of clear legal provisions regarding the division of commercial insurance rights and interests upon divorce, systematically sorts out the division rules for property insurance and personal insurance based on the Civil Code, the Insurance Law, and relevant judicial practice. The article points out that the core of division lies in determining whether the insurance rights and interests constitute marital property. For property insurance, the attribution of insurance proceeds is, in principle, consistent with the ownership of the insured subject matter; compensation may be claimed for premiums paid from marital property after marriage. For personal insurance, a distinction must be made between the type of insurance and the performance status of the contract: accident and health insurance have a personal nature, and the insurance proceeds obtained are generally deemed separate property; for life insurance with a savings or investment nature or where premiums are paid from marital property after marriage, the cash value of the policy and the income corresponding to post-marriage premiums constitute marital property. Upon divorce, the parties may agree to surrender the policy and divide the cash value, or the continuing party may compensate the other party for half. Insurance purchased for children is deemed a gift to the children. Overall, the division of insurance rights and interests upon divorce should comprehensively consider factors such as the nature of the insurance, the source of premiums, the identity of the parties, and the policy's cash value, aiming for a fair balance between protecting individual property rights and the system of community marital property.
Corporate Compliance Rectification Pass Rate Reaches 97% — A Look at the Current Status and Prospects of Criminal Compliance Through Judicial Big Data
Based on compliance needs of private enterprises in the Guangdong-Hong Kong-Macao Greater Bay Area facing criminal risks, and drawing on public security, procuratorate, and court data as well as typical cases, this article systematically reviews the current status and trends of corporate criminal compliance reform. Data show that the procuratorial authorities' rectification pass rate exceeds 97%, but there is still significant room for improvement in case volume and coverage nationwide and in Guangdong. Court reform is accelerating, and public security authorities are gradually becoming more actively involved. Typical cases show that non-prosecution through compliance has gradually become applicable to felony and non-economic corporate crimes, but statutory sentencing standards must be strictly observed. The article further proposes practical prospects: lawyers should promote the pre-positioning of compliance review; advocate for simplified and differentiated compliance procedures to reduce costs for micro, small, and medium enterprises; suggest retaining space for discretionary non-prosecution in the system, not exceeding the statutory maximum sentence for responsible persons, and promoting the addition of a special chapter on criminal compliance in the Criminal Procedure Law to improve the corporate criminal compliance system and the law-based business environment.
Three Major Impacts of the New Company Law on Private Fund Investments
The new Company Law, effective from July 1, 2024, has a profound impact on private fund investments. This article analyzes three main aspects: First, the five-year paid-in capital requirement—private fund managers must ensure paid-in capital meets the standard and be mindful of the impact of equity changes on the controlling shareholder's ratio; the board of directors must fulfill call and forfeiture procedures; and partnership-type funds are also advised to apply strictly. Second, directors' responsibilities are significantly increased, covering capital verification, liquidation obligations, and compensation for violations. To mitigate personal liability risks, it is recommended that private fund institutions avoid directly appointing directors by utilizing shareholder veto power, establishing advisory committees, or appointing supervisors. Third, the new rules on joint liability for equity transfers involving defective capital contributions require private funds to strictly review the transferee's capital contribution capacity and valuation of non-monetary assets when acquiring or transferring existing shares, and to prioritize capital reduction procedures when necessary to avoid joint or supplementary liability. Overall, the article provides targeted compliance responses and transaction structure optimization suggestions for private fund institutions.
Analysis of the Judicial Determination Principles for "Failure to Pay Labor Remuneration in Full and on Time" Under Article 38 of the Labor Contract Law
Attorney LIU Yanfeng and LIANG Xinyuan explores the judicial determination standards for "failure to pay labor remuneration in full and on time" under Article 38 of the Labor Contract Law. The trial guidelines of multiple courts generally establish two major principles: the principle of good faith (examining the employer's subjective fault and objective reasons, excluding non-malicious disputes or calculation errors) and the principle of permitting correction (if the employer has rectified before the worker terminates the contract, economic compensation is not supported). The author argues that adjudication should not mechanically apply the statutory provisions based on their appearance alone, but should comprehensively consider subjective and objective factors, the enterprise's operating status, and social reality, pursuing the unity of legal and social effects to align with the legislative purpose of building and developing harmonious and stable labor relations.
Exploring the Application of Offshore Testamentary Trusts in Mainland China — Taking the "Father's Trust" Case as an Example
Attorney LI Dingbang first elaborates on the institutional advantages of testamentary trusts in wealth传承, personalized property planning, and expanding the scope of beneficiaries. It then uses the "Father's Trust" case as an example, pointing out that the trial court erroneously equated foreign notarization with domestic Chinese notarization, and in determining the applicable law for the trust, ignored the parties'明确 choice of California law, directly ordering the transfer of trust property to the beneficiary, contrary to the settlor's intent and trust jurisprudence. The author analyzes this from the perspective of the Law on the Application of Laws to Foreign-Related Civil Relations and relevant comparative law experience, arguing that foreign-related testamentary trusts should fully respect party autonomy,优先 apply the chosen governing law, and legally recognize the trustee's formal ownership of trust property. The article concludes that when handling such cross-border testamentary trust disputes, courts should balance respect for party autonomy with the maintenance of judicial sovereignty, leveraging professional expertise to achieve safe and effective cross-border asset arrangements.
Insights from the Protection of Genetic Resources and Traditional Knowledge for the Intellectual Property Protection of Traditional Chinese Medicine
The core dilemma of intellectual property protection for Traditional Chinese Medicine (TCM) lies in its collective and historically inherited nature, which structurally conflicts with the current IP system's emphasis on明确 subject identity, creativity, and novelty. This is essentially a global challenge of aligning genetic resources and traditional knowledge protection with the international IP framework. At the international level, mechanisms such as the Convention on Biological Diversity, the Nagoya Protocol, and the WIPO Intergovernmental Committee have continuously explored benefit-sharing and institutional coordination. China has also been actively following up. Given the difficulty of establishing a new special IP system in the short term, current practice should focus on strategic emphasis within the existing framework: actively applying for patents for newly developed products and methods, promoting geographical indication protection for traditional products with distinct regional characteristics, and adopting trade secret protection for complex formulas, processes, and business data. In the long run, TCM IP protection should align with international trends and gradually explore the creation of new forms of IP centered on genetic resources and traditional knowledge.
New Practical Observations on the System of Justifiable Defense
Based on 53 practical cases applying the 2020 "Guiding Opinions on Lawfully Applying the System of Justifiable Defense," this article systematically evaluates the current state of judicial application of the justifiable defense system. The Guiding Opinions have achieved notable results in clarifying the nature of "defense provocation," expanding the connotation of "unlawful infringement," and refining the determination of defense in civil disputes, effectively activating the justifiable defense provisions. However, judicial practice still reveals multiple deficiencies: a subjective tendency in judging unlawful infringement with a lack of evidence-based adjudication thinking; "muddying the waters" judgments hindering the determination of right and wrong; blurred boundaries between mutual affray and justifiable defense; and a "result-oriented" approach making the determination of excessive defense still harsh. To this end, the article advocates for the parallel development of substantive and procedural law, suggesting the construction of supporting procedural protocols, including submitting disputed cases to the adjudication committee for discussion, introducing public hearings, unifying reasoning standards in judgments, strengthening sampling review of similar cases, and establishing a special recording system for judges not applying the rules, with a view to accurately implementing the Guiding Opinions and effectively carrying out the spirit of the rule of law that "justice does not yield to injustice."
A 10,000-Word Technical Analysis of the First AI Copyright Case | Who Owns Computing Power, Who Monopolizes the Future of AI Copyright in China?
Attorney LI Boyang critiques the first judgment by the Beijing Internet Court recognizing copyright ownership for an AI image user. Starting from the underlying algorithm of Stable Diffusion, the author points out that AI image generation is essentially a deterministic "mechanical intellectual achievement" based on prompts, parameters, and random seeds. The user merely selects from the massive pre-generated results of the model without engaging in substantive creative intellectual input. The author argues that this judgment confuses tool operation with creative behavior, not only contradicting the natural attribute of automatic copyright generation but also potentially leading to computing power monopolies, blurring the boundary between protecting the creative process versus the result, and creating unfair discrimination among users of different AI tools. The author contends that purely AI-generated works without substantive secondary creation do not meet the requirements for copyright protection, and intellectual property law should be reconstructed based on technological essence. Accordingly, the plaintiff should not have copyright in the image in question, and the defendant's conduct did not constitute infringement.
Compliance Risks of Corporate Capital Reduction
Capital maintenance is a core principle of modern company law. Non-compliant capital reduction directly undermines creditor reliance interests and actual losses, and may coincide with capital withdrawal, presenting significant legal risks. This article analyzes judicial precedents and compliance recommendations for corporate capital reduction.
A Study on Criminal Involvement of the "Three Village Cadres" and Risk Prevention Measures
Lawyers Chen Gonghui and Chen Wentao take the "three village cadres" as the core research object, and, in light of recent criminal statistics, analyze the prominent manifestations, causes, and preventive measures of village officials' involvement in crimes. Currently, such crimes are highly correlated with official positions, exhibiting characteristics such as "interweaving of red and black," clan interest alliances, and profiteering around government projects and subsidies. The main causes include weak awareness of the rule of law and financial norms, the lingering influence of clan-based thinking, lagging legal aid in rural areas, and supervisory vacuums at the grassroots level. Accordingly, the article proposes strengthening legal education and financial disclosure auditing, maintaining a high-pressure anti-corruption stance to break dependency on personal connections, accelerating the construction of rural legal aid and compliance guidance, and implementing multi-level and three-dimensional oversight mechanisms. Finally, it suggests that village officials enhance risk compliance awareness, conduct self-inspections and corrections as early as possible, and promptly engage professional lawyers when facing criminal risks.
Brief Analysis of Circumstances Where Electronic Games (Practitioners) May Constitute the Crime of Running a Gambling Establishment
Attorney LI Boyang uses the arrest of a senior executive of a well-known live streaming platform on suspicion of running a gambling establishment as a starting point to systematically review the criminal compliance risks faced by online game and internet enterprises. The article first clarifies the legal definition of the "crime of running a gambling establishment" and its nature as a "behavioral crime," emphasizing that actual profit is not a prerequisite for conviction, and the thresholds for conviction and "serious circumstances" are very low (such as commission exceeding RMB 30,000, gambling funds exceeding RMB 300,000, more than 120 participants, or involvement of minors), with a maximum sentence of ten years' imprisonment. Second, it analyzes in detail gameplay mechanics that easily cross criminal red lines, including using充值 virtual currency for betting, random rewards, chess and card games, lottery-style draws, and providing gambling room functions, pointing out that enterprises must strictly isolate充值 currency from probability-based gameplay and strengthen social chat supervision. Through actual court cases, the article notes that criminal liability for running a gambling establishment extends not only to corporate legal representatives but also to employees including technical staff, planners, operators, and customer service personnel who directly participate in or knowingly assist illegal activities. Finally, the article warns internet practitioners to abandon industry惯性 thinking and prioritize legal compliance in business development to ensure stable enterprise operation amid increasingly stringent regulation.
On the Scope of Jurisdiction and Mechanism Coordination in China's Sports Arbitration System
Attorney Zhao Jianjun, with regard to the sports arbitration system implemented under China's new *Sports Law*, analyzes three major problems in practice: excessive restriction of the scope of case acceptance, imperfect internal dispute resolution mechanisms within sports organizations, and the lack of freedom for parties to choose the dispute resolution mechanism. He proposes improvement suggestions: first, expand the interpretation of the scope of sports arbitration to effectively cover sports labor disputes and commercial disputes based on their unique characteristics; second, urge various sports associations to improve the dispute resolution mechanisms in their internal constitutions, clarify the rules for connecting with external mechanisms such as sports arbitration and litigation, implement the principle of "exhaustion of internal remedies," and introduce judicial supervision; third, respect party autonomy by allowing parties to independently choose the competent institution for sports property rights disputes through arbitration agreements, so as to optimize dispute resolution paths, protect parties' rights and interests, and align China's sports arbitration system with international standards.
Risk Analysis and Countermeasures for Nominee Shareholding
Although nominee shareholding enables behind-the-scenes investment, actual investors face multiple risks: the nominee agreement may be invalid (easily deemed void in financial regulatory areas); the nominee may擅自 dispose of the shares; restoration of shareholding requires consent of other shareholders; the nominee's divorce or debts may cause the shares to be混同 executed; and restoration may incur high tax burdens. To effectively prevent these risks, actual investors should avoid nominee arrangements in the financial sector; clearly restrict the nominee's disposal rights and restoration conditions in the agreement, and inform other shareholders in advance; solidify the authenticity of the agreement through notarization,实名 email confirmation, and standardized transfer notes; and优先 choose relatives such as spouses, parents, and children as nominees to benefit from tax reduction policies. Standardizing contract design and完善 the evidence chain are key to protecting the actual investor's lawful rights.
How to Achieve Compliance Governance and Risk Prevention for 'Naked Running' and 'Get Rich Quick' Short Dramas
Attorney Zeng Rui argues that micro-dramas have rapidly risen on the back of a business model characterized by "low cost, fast production, heavy traffic acquisition, and user payment," with the market size approaching 200 billion yuan and attracting massive capital inflows. However, unchecked growth has led to frequent problems such as content homogenization, shoddy production, and vulgar borderline content, triggering severe regulatory and platform crackdowns. Since June 2023, micro-dramas have been subject to a full license coverage and mandatory filing system; no drama may be broadcast without a license. Practitioners must legally obtain multiple qualifications, including ICP, Internet Cultural Business Permit, Radio and Television Program Production Permit, and Audio-Visual Program Transmission Permit, and must place high importance on content compliance to avoid administrative penalties and platform removal risks. At the same time, producers must strictly guard against copyright infringement risks, ensuring that IP adaptation authorizations are clear and lawful, so as to achieve compliant and sustainable development in a market environment of strong regulation and high elimination rates.
Exploring the Path for Technical Secrets to Receive Protection as State Secrets
General Secretary Xi profoundly pointed out that Innovation is the primary driving force for development, and protecting intellectual property rights means protecting innovation. Trade secrets are precious intellectual property and innovation achievements of enterprises, directly relating to enterprises' survival and development.
Under the New Company Law, How Can Minority Shareholders Deal with Willful Majority Shareholders?
The new Company Law strengthens the protection of minority shareholders' rights and interests through multiple institutional innovations to effectively check the abuse of controlling power by majority shareholders. First, it significantly expands shareholders' right to inspect, clarifying that shareholders can inspect accounting vouchers, entrust professional institutions to assist in auditing, and extending the inspection scope to wholly-owned subsidiaries, providing the information foundation for minority shareholders to monitor company finances and operations. Second, it strengthens the fiduciary duties of directors, supervisors, and senior management, introducing the "de facto director" rule and strictly regulating related transaction procedures and disgorgement of profits, effectively lowering the threshold and difficulty of proof for minority shareholders to initiate derivative lawsuits. Third, in response to the dilemma where litigation proceeds belong to the company, the new law creates a minority shareholder mandatory exit right, allowing them to require the company to repurchase their equity at a reasonable price when the controlling shareholder abuses rights. The article emphasizes that although post-event legal remedies are increasingly robust, minority shareholders should focus more on pre-investment agreement structure design and active participation in corporate governance, using ex-ante prevention to replace ex-post博弈, to more effectively protect their lawful rights and interests.
Revision Suggestions and Rationale Regarding the Labor Dispute Judicial Interpretation (II) (Draft for Comments)
In response to the Supreme People's Court's "Judicial Interpretation (II) on the Application of Law in the Trial of Labor Dispute Cases (Draft for Comments)," Zheng Zhongkang, attorney at Long An (Guangzhou) Law Firm, proposed seven revision suggestions based on practical experience and formally submitted them to the Supreme People's Court. The core suggestions include: clarifying that equity incentives do not constitute labor remuneration, restricting application to direct shareholding scenarios and clarifying the exclusion scope of shareholder disputes; advocating that re-employment of retirees should be governed by the Civil Code for service contracts, recommending deletion or substantial revision of the original Article 6; changing the focus of provisions on illegal subcontracting and affiliation from "labor relationship" to "employer responsibility subject," clarifying that it is a pass-through of responsibility rather than a fiction of relationship, and supplementing rules for determining responsibility among multiple affiliated entities based on the closest connection principle; optimizing the review standard for unilateral job transfer and location changes, distinguishing unreasonable wage reduction from other adverse changes, and limiting "incompetence" to circumstances where the employer knowingly assigns unsuitable positions; adjusting the social insurance non-payment clause to add a precondition requiring the employee to demand payment and the employer to refuse before triggering legal consequences; and limiting the clause on wage payment during the dispute period from "may continue to perform" to "no objective obstacles to continued performance," excluding subjective willingness barriers. The overall recommendations aim to clarify the boundaries of legal application, balance labor and management rights and interests, and enhance the practical operability of the judicial interpretation.
Administrative Remedies for Preemptive Registration of Public Cultural Resources as Trademarks
Attorney Li Xinning believes that, in response to the chaotic practice of maliciously preemptively registering trademarks of public resources (such as scenic spots and historical sites, historical figures, trending terms, etc.), this article systematically outlines three relief pathways under the Trademark Law: opposition, cancellation, and invalidation. During the preliminary approval announcement period, opposition can be raised on grounds such as lack of distinctiveness, adverse effects, or malicious registration. Registered trademarks can be subject to cancellation for non-use for three consecutive years without正当理由. For acts of malicious hoarding and disrupting registration order, the primary applicable provisions are Article 44, Paragraph 1 of the Trademark Law ("obtained registration by deception or other improper means") or Article 4 after the 2019 revision ("malicious trademark registration applications not for the purpose of use") to request invalidation. Judicial practice clarifies that Article 7, the principle of good faith, while a fundamental guideline, cannot be directly invoked as a specific legal basis for opposition, cancellation, or invalidation. In practice, precise application of Article 4 and Article 44, Paragraph 1, among other provisions, should be made in light of specific case facts and the principle of non-retroactivity to regulate such acts, thereby safeguarding the trademark registration order and public interest.
Key Points and Analysis of the Third Draft of the Company Law from a Stakeholder Perspective
Attorney Ke Cheng systematically reviews the background, direction, and core points of the third draft of China's Company Law revision. The revision aims to address practical difficulties, rationalize the legal system, balance corporate autonomy and necessary regulation, and focus on the four parties—shareholders, the company, directors/supervisors/senior management, and creditors—to achieve interest coordination and governance optimization. Regarding creditor protection, the third draft improves rules on accelerated maturity of capital contributions, supplementary liability for equity transfers before the contribution deadline, compensation for illegal capital reduction, horizontal piercing of the corporate veil, directors' liquidation liability, and liability for commitments in simplified deregistration. Regarding shareholder rights, the restrictions on one-person companies are relaxed, new forms of capital contribution (equity and claims) are added, a five-year paid-in period and shareholder forfeiture system are established, the scope of inspection rights (including accounting vouchers and access by intermediaries) is significantly expanded, the right to request share repurchase is extended, and a pro-rata capital reduction rule is added. Regarding the responsibilities and authority of directors, supervisors, and senior management, the board's powers are broadened (introduction of audit committees and authorized capital system), external supervision and accountability are strengthened (dismissal without cause, liability for intentional or grossly negligent acts toward third parties), and obligations regarding capital call, standards of fiduciary duty and duty of care, prevention of "shadow directors," and liability for illegal profit distribution and unlawful financial assistance are clarified. The overall revision establishes a more clearly defined and well-functioning institutional framework, which will profoundly affect the behavioral expectations and compliance arrangements of various commercial entities.
Ten Questions and Answers on Filing the Standard Contract for Cross-border Personal Information in the Guangdong-Hong Kong-Macao Greater Bay Area
The "Implementation Guidelines on the Standard Contract for Cross-border Personal Information Flow within the Guangdong-Hong Kong-Macao Greater Bay Area (Mainland, Hong Kong)" aims to facilitate data cross-border flow in the Greater Bay Area. This article interprets key compliance points through ten core questions: the applicable entities include organizations registered in the nine Mainland GBA cities and Hong Kong (including branches); Mainland processors still need to obtain individual consent for cross-border data provision, and data is strictly prohibited from flowing outside the GBA; provision to a third party in the same Hong Kong jurisdiction requires strict conditions. Although the Guidelines simplify the personal information protection impact assessment requirements and do not require submission of assessment reports, the assessment obligation is not exempted. It also clarifies the notification targets for security incidents, special compliance obligations for sensitive personal information, re-filing requirements for超出 scope processing, partial alleviation of the recipient's obligations but addition of government data access notification obligations, compulsory notification to territorial regulators upon contract termination, and mandatory application of Mainland law. Overall, the Guidelines facilitate cross-border data flow in the GBA but do not substantively change the existing Mainland compliance framework. Enterprises must still strictly implement the Personal Information Protection Law requirements and closely monitor subsequent supporting regulations.
A Study on the Effect of Cessation of Interest Accrual When the Surety Becomes Bankrupt Before the Principal Debtor
Attorney WANG Jianqiang examines whether the effect of cessation of interest accrual in bankruptcy proceedings extends to the principal debt when the surety, but not the principal debtor, becomes bankrupt. The author argues that this effect should not extend in reverse to the principal debt, primarily on the following grounds: legislative intent and judicial practice indicate that the acceleration and cessation of interest on the guaranteed claim only target the surety itself and do not affect the continued performance of the principal debt; the rule of cessation of interest in bankruptcy is a mandatory special provision, strictly limiting its application to the debtor entering bankruptcy proceedings; from the perspectives of preventing collusive debt evasion by related parties, protecting creditors' legitimate rights, and maintaining commercial integrity, the principal debtor should not be exempted from subsequent interest and penalty interest due to the surety's bankruptcy. The article further clarifies that the conclusion of the surety's bankruptcy proceedings does not extinguish the principal claim, and the creditor has the right to continue pursuing recovery from the principal debtor for the unpaid principal, interest, and various expenses not satisfied in the bankruptcy distribution. Finally, the article calls for a clear definition of the boundary of the cessation of interest effect on guaranteed claims in bankruptcy practice to balance the interests of all parties and protect the legitimate rights of creditors.
How to Prevent Abuse of Power When a Company Owner Wants Someone Else to Be the Legal Representative?
Attorney ZHANG Jing discusses the dilemma faced by entrepreneurs when delegating management to professional managers—whether to change the legal representative. It points out that the legal representative faces multiple legal liabilities including criminal, administrative, and civil responsibilities, and that actual controllers often use this position to isolate personal risks. If a professional manager with actual management authority serves as the legal representative, preventing abuse of power becomes a key concern. To this end, the article recommends building a prevention system through separation of business and financial powers, improving seal management and delegation systems, establishing internal and external audit mechanisms, and introducing external shareholders to optimize governance structure. It finally emphasizes that the actual controller should strike a balance between restricting power and motivating the manager, designing the system in light of the company's actual circumstances.
The Impact of Consolidated Bankruptcy on the Determination of Bond Issuer Independence
Attorney SUN Wei analyzes the practical relationship between the determination of consolidated bankruptcy of affiliated enterprises and the review of bond issuer independence. It first reviews the "asset, financial, personnel, business, and organizational structure" independence principle and strict information disclosure obligations in bond issuance. It then points out that the statutory condition for substantive consolidation in bankruptcy—"high degree of人格混淆"—significantly overlaps with the standard for determining lack of independence of bond issuers. On this basis, the article further explores the due diligence responsibilities of intermediaries at the issuance stage, clarifying that if人格混淆 existed at the time of bond issuance and intermediaries failed to discover it, they may face joint and several liability for false statements or material omissions. The full text aims to clarify the negative impact of bankruptcy rulings on bond issuer independence and the compliance and liability boundaries of various parties.
Why Equity Investments Become "Money Down the Drain": —A Practical Perspective on Profit Distribution Plans and Related Provisions Under the Judicial Interpretation (IV) of the Company Law
Attorney HUANG Enlin and XU Hongpeng focuses on the judicial recognition standard for "shareholders' resolution specifying a specific profit distribution plan" under Articles 14 and 15 of the Judicial Interpretation (IV) of the Company Law. Through analysis of practical cases, the article points out that courts strictly examine the formal and substantive requirements of resolutions: oral dividend agreements are generally not recognized; if the company's articles of association specify a specific distribution plan, they may be referenced; general meeting documents must satisfy properly qualified signatories, procedural compliance, and specific content (including amount, time, and method) to potentially constitute an effective resolution. Given the extremely high failure rate of dividend lawsuits in practice due to the lack of formal written resolutions, the article recommends that shareholders must ensure written documentation, ensure voting procedures are lawful, and clearly define the core terms of distribution to effectively protect their dividend rights.
Your Company is Preparing for Equity Financing—How Should You Set Up the Equity Structure?
Lawyer Zhang Jing outlines five key points for setting up an equity structure prior to equity financing: first, aggregating similar business lines under the actual controller into a single financing entity to avoid fragmented equity, related-party transactions, and horizontal competition; second, designing a clear and stable control structure to ensure the actual controller retains more than 50% of the voting rights and setting a baseline for control to withstand IPO dilution; third, stripping out relative shareholders in a timely manner to prevent corporate governance defects and avoid risks associated with joint and several liability under VAM agreements and prolonged lock-up periods resulting from relatives being recognized as joint actual controllers; fourth, implementing employee equity incentives prior to the entry of external investors to reduce share-based payment expenses and individual income tax risks while enhancing incentive effects; fifth, adopting a hybrid holding model for founders that combines direct holdings and indirect holdings through a family company to facilitate tax optimization and wealth inheritance. The article emphasizes that equity structure design must be adjusted flexibly based on realistic variables such as the company's paid-in capital, the cooperative intent of shareholders, and tax costs, rather than blindly copying templates.
How to Determine the Guarantee Period When Its Stipulated Start Date Precedes the Maturity Date of the Principal Debt?
Regarding the validity of a clause stipulating the start of the guarantee period earlier than the date of maturity of the principal debt, this article, referencing Article 692 of the Civil Code, points out that although such a situation is generally deemed as no agreement in principle, in practice, the validity of the agreement should be determined based on the end date of the guarantee period: the provision on the start date is invalid because it violates the principle of accessory nature of guarantee and should be legally corrected to the date of maturity of the principal debt, while the agreement on the length of the period or the end date remains valid. Drawing on judicial cases and legal analysis, the article explores the typified application rules for such clauses, pointing out that an excessively short guarantee period may be deemed invalid for violating the principle of good faith, and offers practical suggestions that the start of the guarantee period should be stipulated on or after the date of maturity of the principal debt, and the length of the period should be moderate to avoid legal risks.
Corruption and Bribery Crimes and Money Laundering Will Face "One Case, Two Investigations" — Defense Points and Voluntary Surrender Determination for "Self-Laundering of Bribery Proceeds" in Duty-Related Crimes
Attorney GAO Guoji and LUO Jie provides a legal analysis of the "self-laundering of bribery proceeds" in duty-related crimes. With the implementation of the *Criminal Law Amendment (XI)* and the "one case, two investigations" mechanism among supervisory, procuratorial, and public security authorities, self-laundering has been independently criminalized. When both bribery and money laundering meet the threshold for criminalization, combined punishment for multiple crimes will be imposed. The article focuses on defense points for "self-laundering of bribery proceeds," clarifying the need to strictly distinguish between self-laundering and post-facto disposal of illicit funds. The core issue is whether the actor had the subjective intent and objective conduct to disguise or conceal the source and nature of the illicit funds. The "old law for old, new law for new" principle applies with reference to the March 1, 2021, effective date. Additionally, the article details the rules for determining voluntary surrender in such cases, noting that the establishment of voluntary surrender depends on the scope and timing of the confession: proactive confession of both bribery and money laundering facts establishes voluntary surrender for both crimes; confession of only bribery facts establishes voluntary surrender only for bribery; passive surrender followed by truthful confession of money laundering facts unknown to judicial authorities, or confession of partial bribery facts combined with corresponding money laundering facts, may all result in voluntary surrender for the respective crimes.
Consumer Protection Pathways in Medical Beauty Disputes
With the rapid expansion of the medical beauty market, the core dispute arising from related legal cases is whether the Consumer Protection Law applies. In judicial practice, most courts, based on the nature of medical beauty services as consumer spending, the for-profit nature of such institutions, and the equal civil relationship between parties, support the application of this law, enabling consumers to claim punitive damages with significantly higher compensation amounts than in general medical damage disputes. A minority of courts insist on defining it as medical behavior and exclude its application. The author argues that non-therapeutic medical beauty services constitute lifestyle and spiritual consumption aimed at fulfilling aesthetic needs and should be explicitly included within the scope of the Consumer Protection Law to strengthen consumer rights protection, penalize non-compliant institutions, and promote standardized industry development.
Film Investment: Investor Risks and Practical Analysis
China's film industry has rebounded strongly after the pandemic, with box office revenues reaching new heights and diverse investment models emerging. However, film investment remains a high-risk field. This article focuses on analyzing practical investment risks: investors need to understand box office revenue-sharing rules and clarify the net box office distribution mechanism; verify project registration information through the National Film Administration website, review the completeness of the investment rights chain, and guard against fraudulent projects; carefully distinguish between sole and joint investment, be wary of fixed-return models that are "investments in name but loans in substance," and the capital risks of multi-layer resale of shares; and in cases of illegal fundraising or contract fraud, preserve evidence in accordance with law and seek police reports or judicial remedies. It is recommended that investors rely on正规 channels, strictly review contract terms and subject qualifications, and maintain a rational and prudent investment attitude.
An Equitable Re-Interpretation After the Second Instance Loss of the Zhang Lan Family Trust "Piercing" Case — Resulting Trust is a Required Course for Offshore Family Trusts
In June 2023, the Singapore Court of Appeal dismissed the appeal by Zhang Lan and her affiliated companies, upholding the first-instance judgment appointing receivers over the bank accounts involved in the family trust. The legal basis for the final judgment is the "resulting trust" principle of the common law system. The court did not directly find the trust invalid but, through comprehensive审查 of the trust documents, abnormal fund flows, and the parties' attitudes toward asset freeze orders and other objective facts, determined that Zhang Lan had not completed the transfer of equitable interests in the bank account funds when establishing the trust, effectively retaining beneficial ownership. This case profoundly reveals a new type of legal risk in offshore family trust practice: under the dual ownership system of common law, merely transferring shares of a holding company does not automatically transfer the equitable interests in the underlying assets (such as bank accounts) held by the company. High-net-worth individuals establishing offshore trusts must fully understand the institutional differences between common law and civil law systems, strictly comply with the formalities and delivery requirements for transferring equitable interests, and timely complete asset transfer procedures to avoid trust "piercing" or asset enforcement due to delivery defects.
A Brief Analysis of Personal Information Protection Compliance Audits for New Energy Vehicle Enterprises
Using new energy vehicle enterprises as an example, this article systematically outlines the practical framework for personal information protection compliance audits in conjunction with the Personal Information Protection Law and the National Cyberspace Administration's Measures for the Administration of Personal Information Protection Compliance Audits (Draft for Comments). The article points out that the law clearly establishes regular audit obligations and circumstances triggering mandatory audits due to risks. The Draft further details audit frequency (annually for processors handling over 1 million individuals' data, or biennially for those handling less), methods (internal or external), time limits (90 working days), and institutional independence requirements. In practice, enterprises need to first determine their data volume to establish the audit cycle, integrate audit procedures into their existing data compliance system, and choose between internal or external audit based on their risk profile and professional capacity. Internal audits should strictly follow the standard process of pre-audit preparation, on-site implementation, report issuance, and follow-up on rectification. Although the Draft provides actionable guidance, certain issues such as audit threshold settings, risk-level considerations, and audit institution qualification requirements still await clarification in formal regulations.
Legal Consequences of Transferred Trademarks Declared Invalid Due to Malicious Hoarding
In recent years, the increasingly rampant malicious trademark hoarding has triggered a series of systemic problems in the field of trademark authorization and confirmation. Although legislators modified the Trademark Law in 2019 to try to suppress non-use trademark registration, the new law has been implemented for three years, yet trademark registration applications in China have not decreased.
Criminal Legal Risks and Responses for Online Game Enterprises Under Strong Policy Supervision
With the rapid development of China's online game market, the criminal, administrative, and civil legal risks facing the industry are becoming increasingly prominent. Big data analysis of relevant criminal cases from 2017 to 2022 reveals that cases involving gambling, fraud, computer information system crimes, and intellectual property infringement are prevalent. Against the backdrop of continuously improving regulations such as the Data Security Law and the Personal Information Protection Law, and the normalization of public security crackdowns, online game enterprises face a strongly regulated environment. To address these risks, enterprises should strengthen legal awareness, operate in accordance with the law, establish compliance boundaries, and build a criminal compliance system encompassing pre-event prevention, in-event isolation, and post-event response, while optimizing business operation models to ensure compliant and stable development.
Corporate Organizational Restructuring and Labor Relations Compliance Practice
Taking Alibaba's organizational restructuring driving performance growth as an introduction, this article systematically elaborates on compliant handling paths for labor relations under corporate structural changes. The article delves into the legal meaning of "significant change in objective circumstances" under labor law and the strict requirements for termination procedures. It reviews the key points of judicial review by adjudication authorities regarding the objectivity of adjustments, commercial reasonableness, impact on contract performance, good faith negotiation obligations, and protection of special groups. Based on practical experience, the article provides compliant operation guidelines for enterprises, including solidifying decision-making motives and resolutions, fulfilling democratic consultation and public announcement procedures, formulating written adjustment plans, maintaining full-process standardized documentation, prioritizing consensus-based negotiations, carefully using unilateral position transfers and terminations, and emphasizing the construction of multi-dimensional evidence piles to strengthen the evidence chain. Overall, enterprises need to carefully plan adjustment procedures on the premise of legal compliance, introduce professional support when necessary, and achieve both commercial goals and harmonious and stable labor relations.
Legal Nature and Validity Determination of Memoranda and Letters of Intent
Memoranda and letters of intent are extremely common in commercial transactions. Their legal nature and validity depend not on the document title but on the specific content and whether the parties demonstrate an intention to be bound. Judicial practice typically categorizes them into three types: (1) Negotiating documents—lacking or ambiguous key terms with no expression of intent to be bound, not creating contractual effect, only imposing a duty of good faith negotiation; (2) Preliminary contracts—clearly stipulating the future conclusion of a formal contract, binding on both parties, with breach giving rise to preliminary contract liability; (3) Formal contracts—with specific and clear content and conditions capable of performance, directly establishing substantive rights and obligations, with breach giving rise to liability for breach of contract. In determining the nature, courts comprehensively examine the completeness of terms, genuine contracting intent, and actual performance. Article 495 of the Civil Code no longer presumes such documents to be preliminary contracts, reflecting more rigorous legislation. Parties should specify core transaction terms as clearly as possible and clearly define the document's nature and liability for breach to prevent legal risks.
Analysis of the Legal Effect and Social Impact of Shareholder Register
Introduction: How to confirm shareholder qualification remains a difficult issue in China's theory and practice. As important internal company documents, shareholder registers should play an important role in confirming shareholder identity. However, in reality, the importance of shareholder registers has been consistently diminished, and their legal significance and practical effectiveness have been marginalized.
A Brief Discussion on Improper Prize-Attached Sales
Attorneys GE Xiangrong and LIANG Xinyuan systematically outline the legal definition and compliance key points of prize-attached sales. The article first clarifies the statutory concept of prize-attached sales, which has extended from being traditionally linked to sales to aiming at gaining a competitive advantage, and distinguishes between draw-based and gift-attached forms. Secondly, combined with judicial practice, it analyzes in detail three situations of improper prize-attached sales regulated by the Anti-Unfair Competition Law: unclear prize information affecting prize redemption, deceptive means of falsely claiming prizes or internally designating winners, and draw-based giant prize sales where the maximum prize amount exceeds 50,000 RMB. Finally, it proposes two suggestions for operator compliance: first, strictly abide by laws and regulations such as the Anti-Unfair Competition Law and the Law on the Protection of Consumer Rights and Interests to ensure authentic and transparent activity rules, eliminating fraud and illegal prize setting; second, legally and compliantly collect and use consumers' personal information to improve data security management. The full text aims to guide enterprises to standardize promotional behaviors, maintaining fair competition order and the legitimate rights and interests of consumers while stimulating market vitality.
A Summary of Judicial Practice on Corporate Dissolution Lawsuits for Breaking Corporate Deadlocks—Procedural Chapter
Lawyers Jiao Chenglong and Wang Di systematically discuss the procedural rules for breaking corporate deadlocks through corporate dissolution lawsuits from a practical judicial perspective. Regarding the subjects of the litigation, the plaintiff must be a registered shareholder holding individually or in aggregate 10% or more of the company's voting rights, and defective capital contributions do not affect their right of action, as the proportion of voting rights is independent of the shareholding percentage. The company itself should be listed as the defendant. Other shareholders or interested parties can be listed as co-plaintiffs or third parties depending on their specific claims. The court's acceptance of the case requires strict examination of whether the company is in severe difficulty in operation and management and has exhausted other avenues of resolution. In terms of jurisdiction, territorial jurisdiction is determined by the place of the company's principal office, and level jurisdiction is determined by the level of the registration authority. Regarding preservation measures, although a dissolution lawsuit is an action for modification, the court may, upon application, adopt property or evidence preservation measures to safeguard shareholders' interests and facilitate subsequent liquidation. The preservation amount is proposed by the applicant after a comprehensive consideration of their own interest share, security capacity, and the company's business status, and is ultimately determined by the court within its discretion based on the case details.
Civil Code Provisions on Reduction of Damages for Malicious Breach
Article 585 of the Civil Code provides that if the agreed liquidated damages are lower than造成的损失, the aggrieved party may request the court or arbitration institution to appropriately increase. This article analyzes the application of the damage reduction rule in cases of malicious breach, examining court practice and strategic considerations.
Systemic Reform across Legislative, Enforcement, and Judicial Channels—Interpretation and Outlook of the Opinions on the Reform of the Independent Director System of Listed Companies
Lawyer Bai Congying notes that in April 2023, the General Office of the State Council issued the *Opinions on the Reform of the Independent Director System of Listed Companies*, aiming to address systemic issues such as unclear positioning of independent directors, mismatch between responsibilities, powers, and benefits, insufficient supervisory means, and lack of support for performing duties. The *Opinions* put forward reform measures including clarifying roles and positioning, strengthening qualification and selection management, optimizing performance methods, enhancing performance support, strictly supervising and constraining responsibility, and improving the coordinated supervision system. This reform will promote the revision and improvement of the *Company Law* and its supporting rules, prompt stricter administrative supervision that adheres to the matching of power and responsibility, and drive a shift in judicial practice toward 'proportional liability and precise accountability' when determining the civil liability of independent directors. Overall, this reform is of milestone significance for optimizing the governance structure of listed companies, protecting the legitimate rights and interests of minor investors, and promoting the high-quality development of capital markets.
Interpretation and Analysis of the World Bank's New Business Environment Assessment Project: Secured Transactions Component
Attorney Li Dingbang focuses on the World Bank's new Business Ready (B-READY) assessment project released in 2023, with particular emphasis on its secured transactions module. The article points out that the new assessment project adheres to a functionalist legislative philosophy, with the core goal of facilitating access to credit and transaction efficiency. In contrast to the assessment criteria, China's Civil Code and its supporting judicial interpretations have made significant progress in establishing a unified security framework, expanding the scope of eligible collateral property, and permitting general descriptions. However, shortcomings remain in areas such as the systematic integration of atypical security interests, equal treatment of floating charge subjects, the absence of automatic extension rules for collateral proceeds, the impact of statutory priority rights on the ranking of mortgages, strict restrictions on forfeiture clauses, and the lack of data interoperability among decentralized registration systems. The author argues that China should base its approach on domestic legal practice and national conditions, draw rationally from international assessment experience, and steadily modernize its secured transactions legal system through legislative improvements, advancing information connectivity in registration systems, and optimizing the enforcement procedures for security rights. This should be done without blindly chasing scores, so as to genuinely improve the business environment.
How Do Transacting Parties Bear Losses After Cross-Brade Trade Remittance Fraud?
In cross-border trade, fraudsters often carry out remittance fraud by hacking email accounts, cloning email addresses, and tampering with payment information. Due to the difficulty of cross-border asset recovery, losses must be allocated among the transacting parties. When determining liability, courts apply strict liability as the primary principle under the Civil Code, supplemented by fault liability. The core of liability allocation lies in examining whether each party has fulfilled its "duty of reasonable care," comprehensively considering whether the payer and its agent have fulfilled the obligation to verify abnormal payment information through multiple channels, whether the payee has properly maintained email security, and whether obvious red flags of fraud were ignored. Ultimately, losses are allocated based on each party's degree of fault.
Analysis of Cross-Border E-commerce Foreign Exchange Compliance: Lessons from Shanghai Bank's 100 Million Yuan Fine
Recently, the Shanghai Branch of the State Administration of Foreign Exchange published an administrative penalty decision against a Shanghai bank, imposing a warning and fines of nearly 100 million yuan for violations in foreign exchange transactions including spot exchange, foreign currency wealth management, and guarantee-backed lending. This article examines compliance issues in cross-border e-commerce foreign exchange transactions.
Discipline and Punish: Practical Identification of the Crime of Major Liability Accident
Attorney HE Zhiwei, combining criminal law provisions and judicial practice, systematically interprets the identification standards and application boundaries of the crime of major liability accidents. It emphasizes strict control over the constitutive elements to prevent over-criminalization and mechanical application of justice. On the objective side, it clarifies that the act must occur during production or operation, violate specific and operable safety management regulations, correspond strictly to statutory serious consequences and aggravating circumstances, and pay attention to both positive identification and reasonable exclusion of causation. On the subjective side, it focuses on negligence liability, advocating for distinguishing the duty of foreseeability based on the actor's actual duties and positions, and reasonably defining the weight of responsibility between frontline workers and management supervisors. Drawing on multiple typical acquittal cases, the article systematically reviews grounds for acquittal, including absence of safety management duties, accidents occurring outside the production/operation context, compliant conduct by the actor, unforeseeable risks, and questionable causation, aiming to provide practical guidance for judicial authorities in accurate conviction and sentencing, achieving proportionality of crime and punishment, and protecting lawful rights and interests.
Research on Infringement Determination in Computer Software Cases Where the Defendant Refuses to Submit Source Code
Attorney Tian Shuangli, addressing the difficulty of proof in computer software copyright infringement lawsuits where the defendant refuses to provide source code or object code, explores the rules for infringement determination and the allocation of the burden of proof. The article points out that while judicial practice generally follows the "substantial similarity + access + reasonable defense" rule, code comparison is not the sole or mandatory procedure for infringement determination. When code cannot be directly obtained, the rights holder may satisfy the initial burden of proof through indirect evidence such as the operational interface, installation environment, design defects, and error messages. The court may then issue an order to produce evidence; if the defendant refuses without正当理由, it constitutes spoliation of evidence, and the court will presume substantial similarity of the software and hold the defendant liable for infringement according to law. Combining ten typical cases, the article systematically demonstrates the practical path of indirect comparison and shifting burden of proof in overcoming the "difficulty of proof" in software infringement cases.
If a Company Already Has Articles of Association, Is a Shareholder Agreement Still Necessary?
Anyone who has registered a company knows that when establishing a company, the articles of association are an essential legal document required for registration with the Market Supervision Administration. For limited liability companies, China's Company Law does not require a shareholder agreement (investment agreement or promoter agreement) for company establishment. In practice, many shareholders have doubts: What is the purpose of a shareholder agreement? If there are only articles of association without a shareholder agreement, are there any legal risks? If a shareholder agreement is to be signed, how should it be structured?
The Scope of Obligation, Boundary of Liability, and Response Strategies for Employers' Statutory Deadline to Apply for Work Injury Identification — A Study and Review of Article 17 of the Work Injury Insurance Regulations Based on Case Law Analysis
Attorney LIU Yanfeng discusses the employer's obligation to apply for work injury identification within the statutory time limit under Article 17 of the "Regulations on Work Injury Insurance" and the legal liability for delayed application. Given that the legislation does not clearly stipulate circumstances exempting employers from liability for delayed applications due to non-attributable reasons, resulting in judicial practice mostly adopting mechanical literal interpretation and ruling that employers bear all costs, the article summarizes three mainstream judicial approaches and agrees with the view that differentiation should be applied based on the principle of fault or legal principles. The author argues that the current regulations easily lead to an imbalance of interests between labor and capital, and calls for legislation to clarify liability blocking conditions. The article also recommends that employers establish a sound work injury reporting mechanism, clearly define employees' cooperative obligations in systems or contracts, and submit applications within the statutory period even when in doubt, while fully stating reasons, thereby optimizing employment compliance and risk management.
Behind the Silicon Valley Bank Collapse: Analysis of Financial Supervision Necessity and Behavioral Strategies
On March 9, Silicon Valley Bank experienced a classic bank run when customers attempted to withdraw $42 billion in a single day. This article examines the causes of the bank's collapse and analyzes the necessity of financial supervision from behavioral and regulatory perspectives.
Algorithm Models Should Be the Core of Artificial Intelligence (AI) Infringement Review—Using Diffusion Models and Algorithms as Examples
1. Introduction The rapid development and widespread application of Artificial Intelligence (AI) technology is profoundly changing human production methods and lifestyles. In the cultural and creative field, AI technology is also widely applied in music, painting, literature, and other creation fields. For example, AI-generated music, paintings, and literary works have been publicly displayed and even appeared at auctions. However, AI technology has also brought challenges in intellectual property protection.
E-Commerce Platform Dispute Resolution and Legal Compliance Guide (Part III) — Tort Disputes Between Consumers and Platforms
Click the text below to read the previous two articles: E-Commerce Platform Dispute Resolution and Legal Compliance Guide (Part I) — Contract Disputes Between Platform Operators and Merchants; E-Commerce Platform Dispute Resolution and Legal Compliance Guide (Part II) — Service Contract Disputes and Online Shopping Contract Disputes Between Platforms and Consumers
Should the Manager Be Liable When a Contractual Fund Is "Insolvent"?
Attorney WANG Zhifeng, set against a dispute over pledged-style financing repurchase, explores whether the manager of a contractual fund should bear liability for satisfaction when the fund is "insolvent." The article points out that a contractual fund does not have independent legal personality; its relationship with the manager is essentially a trust relationship. Fund assets are legally independent from the manager's own assets. External debts arising from fund operations should in principle be borne by the fund assets themselves. The manager is only liable with its own assets when it breaches its management duties or has material fault. Additionally, the counterparty securities firm, knowing that the transaction subject was the fund and having participated in the entire transaction and settlement process, should assert its claims directly against the fund assets. In conclusion, the manager in principle does not bear joint and several liability for satisfaction. Specific liability determination requires comprehensive assessment based on the facts of each case and whether the manager fulfilled its fiduciary duties.
Research on Judicial Rules of "Fake Outsourcing" from a Big Data Perspective
Based on big data analysis of a large number of labor outsourcing dispute cases, this article points out that when enterprises adopt labor outsourcing to circumvent employment risks, they are often deemed by courts as "fake outsourcing, real dispatch" due to improper management. Judicial adjudication abandons the doctrine of appearance of contract names and adopts "subordination" and "substantive control" as core review standards, focusing on the attribution of management and command authority, the independence of the contractor's business, the method of remuneration payment, and the subject matter of the contract (work results vs. labor). Once substantively determined to have the characteristics of labor dispatch, the employing unit will be treated as a labor dispatch entity according to law and bear joint and several compensation liability. Enterprises should strictly distinguish the boundary between genuine and fake outsourcing, strengthen the contractor's independent management and work result delivery orientation, and achieve cost reduction and efficiency increase in a legal and compliant manner.
Guide to "Avoiding Landmines" in Offshore Trusts — And an Equity Law Interpretation of the Judgment "Piercing" Ms. Z's Overseas Family Trust
Attorneys SONG Jie and LI Xinghua use the Singapore High Court case of the 'Piercing of Ms. Z's Family Trust' to point out that the industry's widespread attribution of the judgment to 'excessive control by the settlor' is actually a misunderstanding. Through an in-depth analysis of the judgment, the article indicates that the true jurisprudential basis of the case is the 'resulting trust' in equity law. The court did not examine the power reservation clauses in the trust document, but rather focused on whether the equitable ownership of the trust property (bank account funds) was substantively transferred. The fact that Ms. Z continued to freely dispose of, transfer, and act as the owner of the funds after they were transferred into the trust showed that she never relinquished her beneficial interest. Consequently, the funds legally constituted an automatic resulting trust and remained her personal property. This case marks a new direction in risk warnings for offshore trusts: the realization of the asset isolation function of a trust depends not only on the surrender of control but, more crucially, on the thorough transfer of both common law and equitable ownership. Otherwise, the trust property may still be pursued by creditors.
E-Commerce Platform Dispute Resolution and Legal Compliance Guide (Part II) — Service Contract Disputes and Online Shopping Contract Disputes Between Platforms and Consumers
I. Main Legal Relationships: Consumers depend on platforms for online transactions, so they need to register accounts on platforms. When registering, users must sign user agreements and service agreements, and comply with various rules published by the platform, establishing a service contract relationship. In this service contract relationship, the platform only provides platform services, not product sales or service providers.
Practical Research on Arbitration Judicial Review (Part 2): Exploring Judicial Review Standards for 'Whether the Parties Have an Arbitration Agreement'
Introduction: Generally speaking, domestic arbitration is divided into commercial arbitration and labor dispute arbitration. This series of articles on practical research into arbitration judicial review only explores commercial arbitration, namely arbitration arising from 'contract disputes and other property rights disputes between citizens, legal persons, and other organizations as equal subjects' as stipulated in Article 2 of the 'Arbitration Law of the People's Republic of China' (hereinafter referred to as the 'Arbitration Law').
Commercial Arbitration: Values and Differences
Commercial arbitration differs from litigation in fundamental ways reflecting distinct values. This article examines the core principles of commercial arbitration including party autonomy, confidentiality, expertise, efficiency, and finality, contrasting these with court litigation and analyzing their implications for dispute resolution strategy.
Zhou Hongyi's 9 Billion Breakup Fee Sparks Controversy! Is it a 'Divorce Cash-Out' or a Family Governance Arrangement?
Lawyer Zhang Jun believes that the divorce of Zhou Hongyi, the actual controller of 360, and his wife Hu Huan—in which Hu Huan acquired a 6.25% stake (market value nearly RMB 9 billion)—has triggered market skepticism over 'divorce cash-out.' While the company's announcement states that the control remains unchanged and Hu Huan has promised not to reduce her holdings in the short term, the author's analysis points out that Hu Huan gave up her equity in the holding company, holds Singapore permanent residency, and does not hold any position in 360. This indicates that the event is actually a pre-planned asset segregation and family governance arrangement by the Zhou Hongyi family, rather than a simple cash-out. This case serves as an important reference for family governance and equity stability in listed companies.
System Integration Path for Enterprise Trade Secret Legal Protection
This article analyzes the system integration path for enterprise trade secret legal protection, examining current legal framework developments, practical guidance for protecting one's own secrets, avoiding infringement of others' secrets, implementing infringement remedies, and responding to accusations. It also interprets the Shanghai Technology Exchange's Enterprise Trade Secret Asset Confirmation Management Guidelines.
Seriously Non-Compliant APPs May Be Disconnected from the Network! A Detailed Analysis of MIIT's New Regulations Governing the Full-Chain Ecosystem of Mobile Applications
Brief Summary: In February this year, the Ministry of Industry and Information Technology (MIIT) issued a notice to address the current state of mobile internet application services, enhance industry service capabilities and user experience, and proposed 26 measures to further regulate mobile internet application service providers. Unlike previous regulations that only mentioned app developers and platforms, this notice further delves into the upstream and downstream of the entire mobile internet industry, including regulation of the full life cycle of APP developers and operators, distribution platforms, SDKs (Software Development Kits), terminals, and access enterprises.
E-commerce Platform Dispute Resolution and Legal Compliance Guide (I) – Contract Disputes Between Platform Operators and Merchants
Attorney YE Peng and GUO Xiaoxi systematically reviews the service contract legal relationship between merchants and platform operators on e-commerce platforms, established through入驻 agreements. It focuses on three common types of disputes: platform penalty disputes based on platform rules, settlement payment disputes, and subrogation recovery disputes after the platform's advance compensation. For each type, the article clarifies the burden of proof, key issues in dispute, and adjudication rules, and provides compliance recommendations based on the Civil Code and other regulations, covering platform rule publication and notification, electronic contract validity assurance, payment business qualification review, transaction authenticity supervision, and明确 stipulation of subrogation rights. It concludes by addressing the determination of competent courts for contract disputes, offering practical guidance for platform compliance operations and merchant rights protection.
Commercial Arbitration: Ancient and Modern (Part 1)
Commercial arbitration as a dispute resolution mechanism has ancient roots and modern significance. This article traces the historical development of commercial arbitration from ancient Greece and Rome through medieval merchant courts to modern international commercial arbitration, examining key legal frameworks and institutional developments.
Legal Analysis of Employment Transfer Between Related Enterprises
With the development of enterprise groups and conglomerate structures, employee transfers between related enterprises have become increasingly common. This article examines the legal implications, rights protection, and compliance considerations of inter-company employee transfers.
The "Pet Economy" Era: Legal Risks and Compliance Recommendations for Celebrity Endorsements in the Pet Industry
Attorneys Ye Junxi and Li Fei systematically examine the legal characterization and compliance pathways for celebrity endorsement activities in the context of the pet economy. The article clarifies that celebrities may lawfully endorse pet food but should avoid making recommendations in the capacity of a "user." It also points out that practices such as "joining the company as an employee," serving as an "experience officer," "grass-planting," and livestreaming sales—if they substantially utilize a celebrity's image to recommend products—will be deemed by regulators as advertising endorsements. If a pet brand endorsed by a celebrity has quality issues, the celebrity may face administrative penalties and joint civil liability. However, since pets are legally classified as property, the celebrity bears joint and several compensatory liability only if they were at fault, i.e., "knew or should have known that the advertisement was false." Finally, the article proposes compliance recommendations for both pet brands and celebrities, covering key aspects such as background checks, dynamic risk control, content review, retention of usage evidence, and refinement of contractual rights and obligations, to effectively mitigate legal risks and promote the standardized development of the industry.
Practical Research on Arbitration Judicial Review (Part 1): A Brief Analysis of Remedies Available to Parties Dissatisfied with Domestic Commercial Arbitration Awards
Introduction: Generally speaking, domestic arbitration is divided into commercial arbitration and labor dispute arbitration. This series of articles on practical research into arbitration judicial review only explores commercial arbitration, namely arbitration arising from 'contract disputes and other property rights disputes between citizens, legal persons, and other organizations as equal subjects' as stipulated in Article 2 of the 'Arbitration Law of the People's Republic of China' (hereinafter referred to as the 'Arbitration Law').
Can You Make Money with Programs Written by ChatGPT? – An Examination of Fundamental Legal Issues in AIGC
Attorney Wu Rangjun explores issues concerning copyright and legal protection of AI-generated content. There is significant controversy in both academia and the judiciary as to whether AI-generated content can constitute a "work" within the meaning of copyright law, with the core question being whether natural person authorship or the embodiment of individual human input is a prerequisite. Judicial practice has shown inconsistent approaches. Regarding ownership, academia has proposed theories such as copyright attribution, neighboring rights protection, and ownership of fruits (fructus), while practice tends to protect the interests of users or determine ownership by agreement. The article further outlines multiple protection pathways for AI-generated content and discusses mechanisms for allocating tort liability, including employer/agency liability, guardian liability, and the grant of limited legal personality to AI. Although the legal characterization, ownership determination, and liability allocation for AI-generated content remain widely debated, such content has already become deeply integrated into social life, urgently requiring a legal regulatory system adapted to technological development.
Credit Repair — A Path to Redemption for Those Who Have Lost Trust: Interpretation of Major New Regulations on Credit Information Repair
Attorney WU Zhiqin interprets the *Measures for the Administration of Credit Information Repair After Correction of Dishonest Acts (Trial)* (《失信行为纠正后的信用信息修复管理办法（试行）》) issued by the National Development and Reform Commission. The article points out that while China's current dishonesty punishment system has achieved significant results, the cost of punishment for non-malicious or minor dishonest actors is too high, making it urgent to establish a credit repair mechanism to combine punishment with education. The *Measures* clarify that credit repair is a legal right of credit subjects, aimed at lawfully removing or terminating the public disclosure of dishonest information, rather than erasing the illegal facts themselves. The *Measures* detail the scope, duration, conditions, and procedures for repairing serious dishonesty list information, administrative penalty information, and other dishonest information. Meanwhile, the *Measures* establish a central-local credit information coordination mechanism and set severe penalties for malicious acts such as submitting false materials or making seriously untrue credit commitments, including extended disclosure periods, restricted applications, and criminal liability. The author advises the public to strictly distinguish between "credit repair" and "credit reporting repair," engage legitimate and reliable institutions, and pay attention to the legal boundaries of commercial use of public data. The issuance of these *Measures* provides a lawful path for dishonest actors to reform, helps guide them to proactively correct illegal acts, and further optimizes the social credit system.
Proportional and Balanced, Forward-Looking and Reasonable—Re-Evaluating the Minecraft v. Mini World Case
Attorney WU Rangjun focuses on the second-instance judgment (Judgment No. 1035) of the Guangdong High Court in the case of Minecraft v. Mini World, delving into two innovative concepts in the judgment concerning intellectual property adjudication for online games: First, strictly practicing the principle of proportionality, the judgment abandoned the traditional "one-size-fits-all" shutdown model and, after comprehensively considering the high degree of freedom characteristic of sandbox games, the proportion of infringing content, and the feasibility of rectification, precisely ordered the deletion of 230 infringing elements, achieving a balanced protection of the right holder's interests, the infringer's legitimate interests, and the interests of the player community. Second, forward-looking recognition and protection of user-generated content (UGC) rights, clarifying that player-created content in high-freedom games can enjoy independent or co-owned copyright, fully affirming the legitimate interests of the player community. This judgment breaks through traditional inertia in game infringement adjudication, demonstrating judicial practice's respect for the development laws of the game industry and providing important guidance for regulating UGC creation and future industry evolution.
New Trends in Game Skin-Replacement Lawsuits from the Mini World Case
The second-instance judgment (Judgment No. 1035) in the Mini World case clearly defines the boundary of protection for audiovisual works (game graphics), correcting the previous adjudicative approach of automatically including game rules and mechanics within the scope of audiovisual work protection, emphasizing that graphic protection does not extend to non-graphic content. Regarding the protection path for game rules and mechanics, the article argues that reliance should not be placed solely on Article 2 of the Anti-Unfair Competition Law as a catch-all provision, but rather the "other intellectual creations meeting the characteristics of works" clause in the new Copyright Law should be applied for protection. This approach aligns with legislative intent, accommodates diverse forms of game expression, and does not undermine the copyright system. Although limited by the plaintiff's claims and the scope of appeal, the second-instance court was unable to substantively evaluate the copyright protection of game rules and mechanics, falling into a procedural dilemma. Nevertheless, the judgment remains landmark. The article points out that game infringement litigation has entered a new phase, and rights holders need to precisely归纳 the specific expression of game rules and mechanics and accurately select the copyright protection path to achieve effective rights enforcement.
Legal Risks and Preventive Recommendations for Activity Organization in the Frisbee Sports Industry
From the perspective of frisbee sports activity organizers, this article systematically analyzes common legal risks and preventive measures in this field. It first clarifies the legal status of "organizers" of frisbee activities with profit-seeking or competitive characteristics, pointing out that they bear a duty of safety protection in accordance with law. It then explains the organizer's liability from three dimensions: civil, administrative, and criminal. Civil liability mainly arises from failure to fulfill the duty of safety protection and torts by third parties. Administrative liability involves violations of safety management regulations for large-scale public events and requirements for sports event approval and naming. Criminal liability focuses on the crime of重大 accident in large-scale public events and dereliction of duty. In response to these risks, the article proposes practical recommendations, including完善 risk notification and rule training, purchasing insurance in advance, strictly reviewing participants' health conditions, fulfilling activity approval procedures in accordance with law, standardizing event naming, formulating emergency plans, and implementing venue and security measures. In general, frisbee activity organizers should, based on the scale and nature of the activity, comprehensively strengthen事前 prevention and in-process management, strictly comply with regulations, and effectively avoid civil compensation, administrative penalties, and criminal liability risks.
Tradition, Ethos, and Lessons: A Review of ICC PIDA Training Level 1
The author shares their experience participating in the ICC PIDA Level 1 training held in October 2022, systematically reviewing the institutional culture of the ICC International Court of Arbitration, its core arbitration system, and arbitration practice in Mainland China. The article first introduces the ICC's tradition of elitism and the philanthropic dedication of its tutor team. It then analyzes key features of the ICC Arbitration Rules, including the Terms of Reference, Case Management Conference and Procedural Timetable, and evidentiary rules, comparing the differences in application between the IBA Rules and the Prague Rules. Next, drawing on typical judicial cases such as the "Longlide Case," it explores the inclusive policy orientation and friendly judicial environment in Mainland China towards foreign arbitration institutions conducting business, pointing out the broad prospects for international commercial arbitration in the mainland. Finally, it describes the professionalism of the participating lawyers and the benefits gained from the training. The article provides a clear overview of international commercial arbitration rules and the development of arbitration rule of law in China, combining institutional interpretation, practical observation, and industry outlook.
Nature and Validity of Deficiency Compensation as Credit Enhancement for Asset Management Products – A Study Based on the China Merchants Bank v. Everbright Capital Contract Dispute Case
Using the China Merchants Bank v. Everbright Capital case as a sample, this article systematically analyzes the legal nature and validity determination rules of "deficiency compensation" arrangements in bank wealth management products, based on the Civil Code and relevant judicial interpretations. The article points out that deficiency compensation can be legally characterized as a guaranty contract, joinder of debt, or an independent contract depending on the agreement's wording and transaction structure. In terms of validity review, judicial practice focuses primarily on whether internal corporate decision-making procedures have been followed, whether the arrangement constitutes a prohibited rigid redemption in asset management business, whether it employs lawful forms to conceal illegal purposes in circumventing regulation, and considerations of public order and good customs under the increasingly stringent regulatory environment. Generally, courts tend to respect the principle of party autonomy in commercial matters and原则上 recognize the validity of deficiency compensation provided by independent third parties or junior investors in structured transactions. However, when the manager or issuer of an asset management product provides a rigid redemption commitment, or when the arrangement substantively constitutes regulatory arbitrage that undermines financial security, it is often deemed invalid. Financial institutions should strictly standardize transaction structure design and strengthen compliance review in practice to prevent defects in the validity of such agreements.
[No. 1 in China, No. 2 in the World] Is Hisense Playing 'Edge Ball' at the World Cup?
Attorney YE Junxi believes that regarding the legal controversy triggered by Hisense's advertising slogan 'No. 1 in China, No. 2 in the World' at the Qatar World Cup, the article outlines the pros and cons of whether it violates China's Advertising Law. The author points out that the core of advertising compliance lies in balancing legal risks and commercial benefits, rather than blindly pursuing 'zero risk.' Hisense's advertisement was placed overseas, has data support, and leaves room for reasonable explanation. Its compliance adjustments, such as adding qualifying words, reflect the company's grasp of regulatory trends. The article emphasizes that advertising compliance needs to dynamically balance legal boundaries and commercial purposes. Hisense's marketing this time has achieved significant economic benefits and also reflects the strategic vision of Chinese brands going global. Enterprises should conduct advertising compliance under professional guidance to achieve the unity of legal safety and commercial value.
Artificial Intelligence: A Lin Sister Appears Between Lawyers and Paralegals
Walk into any standardized law firm, whether in Shanghai, New York, Mumbai, or Tokyo, and you will certainly see two types of lawyers: one is the associate lawyer, and the other is a former associate lawyer. A doctoral degree in humanities and science means qualification to explore frontiers and指点江山 (make strategic remarks), while a doctoral degree in law, whether a Chinese Juris Doctor or an American JD, must go through the associate stage before becoming a lawyer.
Interpretation of the "Implementation Rules for the Supervision and Administration of Financial Leasing Companies in Guangdong Province"
Attorney HUANG Enlin interprets the 'Implementation Rules for the Supervision and Administration of Financial Leasing Companies in Guangdong Province' officially issued in August 2022. The article points out that the 'Rules' clarify the industry self-regulation function of the Guangdong Financial Leasing Association and strengthen the substantive review of the proposed companies' business models and profitability sustainability. Core regulatory requirements include: strictly prohibiting the outsourcing of core business such as credit review and the lending of qualifications; prudently carrying out batch business facing natural persons and rent loans; stipulating that leased assets must be fixed assets with clear ownership, substantially restricting complex sub-leasing transactions; completely eliminating exemptions for related-party transactions and strictly following the corporate governance recusal system; adding new compliance obligations for customer complaint handling and personal information protection; and significantly detailing and strengthening the reporting mechanism for major events. Overall, the 'Rules' accurately respond to industry concerns, demonstrate the prudent orientation of local financial regulation, and will profoundly reshape the compliance system and future development pattern of financial leasing companies in Guangdong Province.
Security Assessment and Compliance Points for Cross-Border Transfer of Healthcare Data
Attorney CHEN Shifu focuses on the compliance and security assessment of cross-border transfer of healthcare data, pointing out that this field, involving national security, public interest, and personal privacy, is a high-risk area in China's cross-border data compliance. The article systematically reviews the evolution and core principles of China's cross-border data transfer regulatory policies, and, drawing on international regulations such as those of the EU and the US, clarifies that the core of cross-border data flow lies in balancing data openness and utilization with security risk management. Regarding the security assessment mechanism, it clarifies the quantitative scenarios triggering statutory declarations and details the key points for enterprise self-assessments and the key review items by the national cyberspace administration. Finally, it provides enterprises with actionable compliance management recommendations from five dimensions: establishing a data classification and grading management system, introducing security technologies for regular "health checks," dynamically adjusting compliance plans based on specific流通 scenarios, strictly reviewing the qualifications and capabilities of overseas recipients, and adhering to the bottom line of national security and privacy protection. The aim is to assist healthcare enterprises in achieving orderly cross-border data flow and value conversion while strictly observing security red lines.
How to Avoid Personal Shareholder Liability Based on the Analysis of Accelerated Maturity of Shareholder Capital Contributions?
Attorney Wu Rangjun discusses the risks of high registered capital under the subscription registration system of the Company Law, focusing on the applicable scenarios of accelerated maturity of shareholder capital contributions and risk prevention recommendations. Accelerated maturity of shareholder capital contributions refers to the situation where shareholders are required to pay their subscribed capital contributions ahead of schedule under specific conditions. This mainly applies when, during the enforcement stage, the company is insolvent and meets the grounds for bankruptcy but does not apply for bankruptcy, after bankruptcy proceedings have commenced, upon the company's dissolution and liquidation, and in litigation proceedings where, in principle, it is not supported, except in exceptional circumstances such as the company already meeting the grounds for bankruptcy, malicious extension of the capital contribution period after the debt arises, or involving priority claims such as wages. To avoid personal liability of shareholders, it is recommended that enterprises reasonably set registered capital based on actual needs, complete actual capital contributions as soon as possible, and strictly distinguish between shareholders' personal assets and company assets to prevent joint and several liability risks.
The Tail of a Contract: Function and Ceremony
Attorney HONG Shihong explores the tail-end clauses of contracts, taking the notice clause as an example. It points out that although such clauses are often regarded as standardized templates, they have critical legal functions in triggering default remedies and determining litigation outcomes. The article emphasizes that legal professionals should avoid blindly applying boilerplate clauses and should instead engage in meticulous drafting and management based on specific transaction contexts and performance facts. Otherwise, procedural defects and loss of substantive rights may easily occur. Additionally, through the evolution of U.S. anti-forced labor clauses and judicial precedents, the article reveals the political and commercial games behind legal texts, advocating that Chinese enterprises should proactively negotiate clauses that serve their interests in foreign-related contract negotiations to promote equal and mutually beneficial international economic and trade cooperation.
Copycat Imitation of E-commerce Bestsellers Persists: Are You Falling into These Three Major Patent Protection Traps?
"Hot-selling" products in e-commerce are easily and quickly copied by competitors. Many sellers attempting patent enforcement often fall into three major misconceptions: first, applying for a patent only after a product becomes a bestseller, resulting in loss of novelty; second, filing only a single patent for one product, leading to narrow protection scope that is easily circumvented or invalidated; and third, mistakenly believing that obtaining a patent certificate guarantees smooth enforcement, while neglecting infringement determination principles and claim drafting quality. To effectively extend product红利 periods, sellers should develop a forward-looking patent布局 mindset, adhere to the principle of "apply first, launch later," build multi-dimensional patent portfolios to raise the cost of imitation, and focus on patent drafting quality with reasonable claim scope. E-commerce practitioners need to align with the requirements of high-quality intellectual property development, incorporate patent layout into R&D budgets, and build solid competitive barriers through high-quality patents.
When a Purchaser Lacks Home-Purchase Qualifications, Can They Exclude Enforcement in an Execution Objection Lawsuit by a Third Party?
Attorney Hu Ying explores whether a purchaser without home-purchase qualifications can exclude enforcement under Article 28 or Article 29 of the "Provisions on Execution Objection and Reconsideration" when the purchased property is sealed up by the seller's creditor. Regarding Article 28, the prevailing judicial view holds that a purchaser whose number of owned properties has reached the purchase restriction limit has self-fault in failing to transfer registration, failing the statutory condition of "non-transfer due to reasons not attributable to the purchaser," and thus cannot exclude enforcement. Regarding Article 29, although there is divergence in judicial practice, the prevailing view is that a purchaser without home-purchase qualifications cannot legally request registration of transfer, does not hold a real right expectancy, and therefore has no right to exclude enforcement. The author agrees with this prevailing judicial reasoning, pointing out that such purchase conduct violates purchase restriction policies and lacks legal basis, but also emphasizes that in judicial practice, courts ultimately exercise comprehensive discretion based on the facts of each case and the principle of balancing interests.
Five Considerations for Setting Up an Equity Structure
The design of an equity holding structure should be closely centered around the specific goals of the shareholders. Lawyer Zhang Jing systematically expounds on the advantages and applications of different holding models from five core dimensions: first, establishing a limited liability company as a holding platform to effectively isolate the debt risks of the project company; second, utilizing holding platforms to optimize the tax burden on dividend distributions and share reductions, and to facilitate reinvestment; third, using holding companies in mergers and acquisitions to apply special tax treatment and achieve tax deferral; fourth, using holding companies to coordinate financing guarantees, asset acquisition, and business incubation to empower capital operations; fifth, utilizing the retained earnings of holding companies in family wealth succession to avoid individual income tax on dividend distributions when specifically supporting offspring's entrepreneurship. Enterprises should flexibly combine these dimensions based on actual strategic needs to set up the optimal equity structure.
Contribution Liability of "Promoters" in Limited Liability Companies
Attorney XIE Xin analyzes the concept and contribution liability of "promoters" (i.e., shareholders at the time of incorporation) in limited liability companies, pointing out that current judicial interpretations have expanded the joint liability of promoters for capital contributions to shareholders at the time of incorporation of limited liability companies. The article focuses on clarifying four major practical difficulties: First, clarifying that "failure to perform or fully perform capital contribution obligations" refers to failure to pay the full amount of the capital contribution agreed in the articles of association on time. Non-payment before the contribution deadline does not constitute this circumstance. Second, defining that "accelerated maturity of capital contributions" only applies to statutory or specific circumstances such as bankruptcy or dissolution, with the liable subject limited to current shareholders, and generally does not trigger the joint liability of other promoters. Third, analyzing the liability of original promoters after equity transfer—transferring after the contribution deadline has passed requires liability; for transfers before the deadline, the mainstream view is that the contribution obligation transfers with the equity, unless there is malicious debt evasion. Fourth, clarifying the liability boundaries after company capital reduction/increase—for capital reduction without properly notifying creditors, promoters are liable to the extent of their pre-reduction subscribed capital; for capital increase defects, liability only arises for debts incurred after registration, and other promoters generally do not bear joint liability. This article, through relevant legal provisions and typical cases, provides clear thinking for judicial adjudication.
Zhang Chi: Rethinking the Regulation of Private Digital Currencies
Attorney ZHANG Chi systematically outlines the concepts, attributes, and developmental context of private digital currencies, and reviews the evolution of China's regulatory policies from relative laissez-faire to strict limitation, and then to the 'separation of blockchain and cryptocurrency'. The article points out that while the existing strict supervision has effectively curbed speculative chaos and illegal crimes, maintaining financial stability, it has also stifled financial innovation, led to inconsistent judicial adjudication standards, weakened substantive protection for investors, and may cause China to lose its voice in formulating international rules in the digital asset field. To this end, the article proposes that regulatory policies should conform to technological, economic, and legal logic, adopting a differentiated regulatory path based on functional classification, applying different policies to payment-oriented and asset-oriented economic behaviors. It suggests prioritizing the relaxation of controls on asset-oriented businesses, leveraging special economic zones like Shenzhen and Hainan to pilot the establishment of centralized digital asset trading platforms, in order to promote financial technology innovation and healthy industry development under the premise of building a solid risk baseline.
A Listed Company Wants to Acquire My Company — How Should I Respond?
Facing an acquisition offer from a listed company, founders should respond rationally and take the following key measures: First, sign strict confidentiality agreements with the acquirer and key employees to prevent information leakage that could cause team unrest or transaction failure. Second, conduct a comprehensive self-review of historical financial compliance risks, as the acquisition will trigger strict audits and information disclosure; if risks are uncontrollable, consider not selling. Third, proactively prepare an "Equity Sale Prospectus" to clarify valuation logic and insist on the seller quoting first to gain negotiation leverage. Fourth, carefully assess the acquisition's impact on existing customer resources and the core team, striving to retain key personnel or formulating compensation plans. Fifth, regarding earn-out clauses commonly proposed by acquirers, conduct quantitative calculations based on product competitiveness and profitability, set reasonable performance targets, reserve financial exceptions, calculate the worst-case compensation底线, and strive to retain company operational control during the earn-out period. Given the complex commercial, financial, and legal issues involved in M&A, it is recommended that enterprises engage professional advisory institutions for full-course assistance.
When First Seal and Subsequent Seizure Coexist, How Should the Court Dispose of Property?
Against the backdrop of the Supreme People's Court's 2022 "Notice on Properly Handling Issues Related to the Effect of Subsequent Seizures," this article systematically analyzes the rules for property disposal and distribution when first seal, subsequent seizure, and priority claims coexist in enforcement proceedings. The article points out that the new Notice clarifies the formal effect of subsequent seizures and their binding force on the first-sealing court. For ordinary claims, courts apply proportional distribution rules based on the debtor's nature and property sufficiency. Whether the first-sealing creditor can receive a larger share remains controversial in practice. For priority claims, after satisfaction of the first-sealing priority claim, the剩余 proceeds should be transferred to the subsequent seizure court. When the first-sealing court fails to act for over 60 days, the subsequent priority claim court may request transfer of enforcement authority. For cases where the first-sealing court has not yet entered enforcement, the judicial trend favors allowing the subsequent seizure court to request transfer of disposal authority when the first-sealing court has not acted for an extended period, while emphasizing the need to protect the first-sealing creditor's lawful rights. The article concludes with practical recommendations for first-sealing and subsequent seizure creditors on proactively following procedures, actively communicating, and safeguarding rights in accordance with law.