Effective Date for Change of Legal Representative in a Chinese Company

According to the Company Law of the PRC, a Chinese company must appoint a legal representative, who shall be the director or manager represents the company to execute corporate affairs. If a director or manager who also serves as the legal representative resigns, it shall be deemed that he or she simultaneously resigns from the position of legal representative.

When a Chinese company changes its legal representative, the internal effective date and external effective date are different. The differences are as follows:

1. Internal Effective Date
   
   

   (1)	Become effective from the date that the shareholder resolution on the change of legal representative takes effect; or
   (2)	Become effective from the date that the company receives the written notice of resignation from the legal representative.

   
   
2. External Effective Date
   
   

   (1)	Become effective from the date that the company registration authority approves and registers the change of legal representative.
   (2)	The change of legal representative cannot be asserted against any third party acting in good faith if it fails to register with the company registration authority.

As the change of legal representative cannot assert against any third party acting in good faith without registration with the company authority, the company should apply for the change of legal representative with the company registration authority in time to avoid unnecessary risks.

KAIZEN Group is equipped with experienced and highly qualified professional consultants and is therefore well positioned to provide professional advices and services in respect of the formation and registration of company, application for various business licences and permits, company compliance, tax planning, audit and accounting in China. Please call and talk to our professional consultants for details.

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