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Corporate Service - China

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Q&A Regarding New Company Law of 2024 (3)

Answer
Q:
Can a limited liability company be changed to a joint stock limited company?
A:
The change from a limited liability company to a joint stock limited company shall meet the conditions for a joint stock limited company as stipulated in the Company Law. The change from a joint stock limited company to a limited liability company shall meet the conditions for a limited liability company as stipulated in the Company Law.

Q:
How to dispose of the creditor's rights and debts before the change from a limited liability company to a joint stock limited company?
A:
Where a limited liability company is changed to a joint stock limited company, or a joint stock limited company is changed to a limited liability company, the creditor's rights and debts of the company before the change shall be inherited by the company after the change.

Q:
Does the company, subsidiary or branch have legal personality?
A:
The company and subsidiary have legal personality and independently bear civil liabilities according to law; The branch does not have legal personality, and its civil liability shall be borne by the company.

Q:
Can the company invest in other enterprises?
A: The company can invest in other enterprises. Companies can invest in other businesses. Where the law stipulates that a company shall not become a joint and several liability contributors for the debts of the invested enterprise, such provisions shall prevail.

Q:
Can the company provide guarantees for others?
A: Where a company makes investments in other enterprises or provides guarantees for others, the decision of the board of directors or the shareholders' meeting shall be made in accordance with the articles of association of the company.

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