Foreign director liability

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clpstaff &clp articles

With a heightened focus on executive corruption and the new tort law coming into effect in July, three specialists offer their insights on how foreign senior personnel can protect themselves from liability should their companies run into trouble



I am the director of a foreign company with several China operations. With the tort liability law coming into effect next month (July) and recent headlines about corruption, I am concerned about senior personnel liability if any problems arise involving my company. I'm not too certain on PRC laws governing director, supervisor and officer liability.

To what degree could I be held responsible and how do I protect myself?




The domestic perspective

Under the current PRC legal regime, directors and senior management personnel of a China-registered foreign invested company may face two layers of liabilities: one is the civil liabilities under the General Principles of PRC Civil Law and the PRC Company Law; the other is the criminal liabilities imposed by the PRC Criminal Law.

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