揌aworth & Lexon Law Newsletter?is issued every month, mainly introducing the legal change in the fields of Corporate, Securities, Foreign investment, Intellectual property rights, International trade etc. with necessary comment. All the comments do not mean the legal opinion of our firm and the firm does not have any legal liability for such comment. Should you have any interest in any topics or any questions please feel free to contact the firm. You will be expected to have satisfactory response from the professional attorney of our firm.
?nbsp;The Seminar ?Why Poland ? Organized by the Consulate General of Poland in Shanghai and Co-organized by Our Firm, was Successfully Held
?nbsp;Regulatory Rules on Strategic Investment of Overseas Investors in Listed Companies
?nbsp;Latest Laws and Regulations:
?nbsp;Decisions on Amending 揜egulations on People's Republic of China on Company Registration?by State Council
?nbsp;Measures on Protection of Intellectual Properties on Exhibition
?nbsp;Interim Measures on Administration for Encouragement by Share in Listed Companies
?nbsp;Guides on Protecting Investors' Rights in Small and Medium Enterprise Board
The Seminar ?Why Poland ? Organized by the Consulate General of Poland in Shanghai and Co-organized by Our Firm , was Successfully Held
The Investment Promotion seminar 揥hy Poland?and ?Poland -the new Gate to Europe? organized by the Consulate of the Republic of Poland in Shanghai and co-organized by Haworth & Lexon Law Firm, was held at Radisson Plaza Xing Guo Hotel on December 16, 2005.
Poland , as the most developed country in Eastern Europe , became a member of the European Union on May 1, 2004. After that, Poland became one of the most attractive investment destinations in the world.
The Consulate of the Republic of Poland and its domestic ministry in charge of investment had a comprehensive preparation for this Promotion Seminar. Haworth & Lexon gave a full support for the advance-phase preparation and clients contact.
Mr. Marek Plecinski, Chief of Economic and Commercial Section of the Consulate, Mr. S. Mikosz, vice chairman of Polish Information and Foreign Investment Agency, Chinese-Polish Joint Stock Shipping Company and other honored guests from Poland attended this Seminar. A lot of Chinese private enterprises, World Chinese Enterprises Association, state-owned enterprises and some authorities in charge of foreign investment also attended this Seminar. A lot of famous enterprises, such as Shanghai Automobile Group, F & J Group (It has entered the East European market for more than 10 years, and began to invest in Poland.), show their great interest and passion in the investment in Poland. About 50 domestic companies attended this Promotion Seminar.
Mr. Sean Yuan, Mr. Bailey Xu, Mr. Dermot Zhang, Mr. Marshal Chen, Mr. Tony Zhong and Mr. Huixiao Han, lawyers of Haworth & Lexon, were also invited to attend this Seminar.
At the Seminar, Mr. S. Mikosz, vice chairman of Polish Information and Foreign Investment Agency and Mr. Huixiao Han, lawyer of Haworth & Lexon, introduced the political and economic situation in Poland and the preferential policies for the investment in Poland from different aspects. The Polish Economic Development Zone was specially discussed. After that, Mr. Marek Plecinski and Mr. S. Mikosz answered several questions concerning the investment preferential treatments and the taxation issues. They also have a great communication with the Chinese enterprises.
Regulatory Rules on Strategic Investment of Overseas Investors in Listed Companies
Ministry of Commerce, China Securities Regulatory Commission, State Administration for Industry and Commerce, and the State Administration of Foreign Exchange promulgated a new regulation ?Regulatory Rules on Strategic Investment of Overseas Investors in Listed Companies?on December 31, 2005 and it will come into force on January 31, 2006.
This regulation applies to cases that the foreign investors acquire class A share by medium and long-term strategic acquisition in listed companies which have completed reforms of non-tradable shares or the companies which have listed lately after reforms of non-tradable shares provided they acquire at least 10% of the stock.
The Rules stipulates four principles for strategic investment, and also made stipulations of conditions which shall be met by the investors who are doing strategic investment.
The proceedings provided by Rules on transferring by directional issue are different from that by agreement. But they both need resolutions by board of directors and shareholder's meeting, the relevant agreements between the listed companies and investors, and approvals by Ministry of Commerce. If it is a directional issue, it shall be examined and approved by China Securities Regulatory Commission after approvals by Ministry of Commerce; and if it is a transfer by agreement, the name of owner shall be changed in securities registration and clearing institutions and it shall be put on record to the securities Regulatory Commission. After these procedures, the company shall get the approval certificate for foreign invested companies from Ministry of Commerce and carry on alteration registration in administration for industry and commerce.
The Rules also stipulates on the issue that the investors decrease their shares in the companies. If they transfer the shares they hold on class A share market, they may apply to local administrations of foreign exchange for foreign exchange remittance.
Decision on Amending 揜egulations on People's Republic of China on Company Registration?by State Council
State Council promulgated ?Decision on Amending 揜egulations on People's Republic of China on Company Registration ? and it came into force on January 1, 2006.
The Decision amends the jurisdictions of State Administration for Industry and Commerce and the local Administrations for Industry and Commerce on company registration. It also adds provisions on investment by shareholders, which clearly provides that 搇abor, credit, name of a natural person, business reputation, franchise rights or mortgaged assets shall not be used as investment.?The business scope of a company shall be provided by articles of association, and one-person company shall be stated clearly on business license.
If a joint stock company limited is established by promotion, when it submits the documents to the registration authority, it shall also submit the memo of the establishment meeting; if the company by promotion intends to give public offer, it shall submit the approval documents by securities supervisory administration.
The decision allows the applicants who intend to set up companies or branches of companies to submit their applications to the registration authority, or apply by letter, telegraph, fax, telecommunication and email, in accordance with the new development.
The decision adds some provisions to limit the registration authority, which require the authority to make decisions promptly on acceptance, refusal to acceptance, or requirement for amendments after it receives materials.
Measures on Protection of Intellectual Properties on Exhibition
Ministry of Commerce, State Administration for Industry and Commerce, National Copyright Administration and State Intellectual Property Office promulgated 揗easures on Protection of Intellectual Properties on Exhibition?, and it will come into force on March 1.
The Measures stipulates that if the period of exhibition is more than 3 days, and if the administrative authority considers it necessary, the exhibition organizers shall set up a complaining organ and the Measures stipulates on the responsibilities of the authority. Intellectual property owners may complain to this organ or administrations for intellectual property, but it has to submit relevant materials, including the certificate for his right, facts of infringement and reasons. If the complaining organ thinks that the materials are not complete, it may notify him to supplement. If he refuses to do so, the organ shall not accept; if the materials are complete, the organ shall transfer the documents to the administration for intellectual property within 24 hours.
The Measures stipulates on relevant complaints on patent, trademarks and copyright. The complaining organs of exhibition may ask the local intellectual property office, administration for industry and commerce and copyright administration respectively for help.
Interim Measures on Administration for Stock Incentive Mechanism in Listed Companies
China Securities Regulatory Commission promulgated ?Interim Measures on Administration for Stock Incentive Mechanism in Listed Companies ?on December 31, 2005, and it came into force on January 1, 2006.
Stock incentive mechanism means that listed companies encourage their directors, supervisors, high-level management personnel and other staff by stock of the company. This Measures also applies to encouragement by limited stocks, stock options and other means permitted by laws and regulations. The regulation has some requirements on listed companies who want to encourage their staff by stock, and the objects of encouragement. Chapter 3 and Chapter 4 of the Measures specifically provides on conferring limited stock and stock option, such as provisions on conferring date, exercising price and exercising date. Chapter 5 specifically provides on the procedures of encouragement by stock, including resolutions, relevant agencies and documents and reports which shall be submitted.
Guides on Protection of Investors' Rights in Small and Medium Enterprise Board
Shenzhen Securities Exchange promulgated ?Guides on Protection of Investors' Rights in Small and Medium Enterprise Board ?
The Guides stipulated that, shareholders who independently or aggregately have more than 1% shares may propose to oppugn or discharge an independent director. It requires the articles of association of listed companies to provide that external guarantee shall be agreed by at least two thirds independent directors. The Guides stipulated that small and medium enterprise board shall make continuous and steady policy for profit distribution to prevent from vicious distribution to harm the business condition of listed companies. If the real controllers of listed companies want to reform the substantial assts or transfer the controlling power, Guides requires the listed companies to disclose such cases. It also requires the articles of association to provide aggregate voting system when electing directors or supervisors and it encourages shareholders who have more than 1% shares to nominate. It clearly states that Shenzhen Securities Exchange will establish archives databank for real controllers and persons who have relationship with the listed companies.