Substantively Revised PRC Company Law will enter into effect on 1 July 2024

On 29 December 2023, the Standing Committee of the National People's Congress of the People's Republic of China ("PRC") adopted and promulgated a substantive revision of the PRC Company Law ("2024 Company Law"), which will enter into effect on 1 July 2024.

The now final version of the 2024 Company Law is the result of a lengthy drafting process. 3 comprehensive previous draft versions had been released for public comments in 2021, 2022 and 2023, before the final and fourth draft has been adopted.

The 2024 Company Law comprises 15 Chapters and 266 Articles in total. It constitutes a major update and introduces multiple changes compared to the current version of the PRC Company Law. The current version had first been promulgated on 29 December 1993 and entered into effect on 1 July 1994, and has last been amended with effect of 26 October 2018 ("2018 Company Law"). The 2024 Company Law, inter alia, provides for changes regarding capital contributions, corporate governance as well as responsibilities of shareholders and key personnel of companies.

The 2024 Company Law will have major impact on all existing and future companies in the PRC, whether they are foreign-invested or domestic, and whether they are limited liability companies or companies limited by shares.

Accordingly, shareholders and PRC companies should familiarize themselves with the new law and assess the impact it may have on PRC companies and their operations in the PRC.

Please see our newsletter highlighting the key aspects of the new law.