As Chinese lawyers engaged in the foreign investment field, we have assisted many clients in changing the legal representative in their foreign-invested companies in China. Below are the basics you need to know about changing the legal representative in China.
1. Is the change of the legal representative subject to the consent of the current legal representative? What if the current legal representative refuses to cooperate?
According to our experience, the consent of the current legal representative is not needed in general. But in some cases, the administration of market regulation may require the current legal representative to sign the documents related to the application for change of registration. In case of refusal by the current legal representative, the company may file a lawsuit for a dispute over change of company registration.
2. How can a company change its legal representative?
The common procedures are as follows: passing the relevant resolution or decision on changing the legal representative by the shareholders’ meeting or the board meeting, depending on the provisions of the articles of association; applying for change of registration with the administration of market regulation (former administration of industry and commerce); and filing for change of registration with banks and other relevant government authorities.
3. Can a legal representative resign?
Yes, the legal representative can submit its resignation to the shareholders’ meeting or the board meeting for approval. And a new legal representative may be appointed in his place.
4. Is the legal representative qualification heritable?
The legal representative qualification cannot be inherited. After the death of the legal representative, the company should appoint a new legal representative in accordance with the statutory procedures.
5. Is the change of registration with the administration of market regulation compulsory? Is there any time limit for this procedure?
Yes. According to Article 24 of the Regulations of the People’s Republic of China on the Administration of the Registration of Market Entities, the items subject to change of registration shall be filed to the registration authority for change of registration within 30 days after the relevant resolution or decision is made or any matters causing change of registration stipulated by law happen.
6. What documents are required for the change of registration concerning the change of the legal representative?
The following documents are required in general:
(1) application for change of registration signed by the legal representative;
(2) resolution or decision on the change made in accordance with the Company Law;
(3) other documents required by the administration of market regulation.
If the items subject to change of registration involve change of the articles of association, such documents shall be submitted including the revised articles of association or the amendment to the articles of association signed by the legal representative. Where the items subject to change of registration are subject to some approval prior to the change of registration according to law, such documents for approval shall be submitted to the administration of market regulation.
As Chinese lawyers experienced in the field of foreign investment for a long time, we have assisted many foreign invested enterprises in their legal issues related to legal representatives. If you have any legal questions regarding the legal representative, please feel free to contact us via firstname.lastname@example.org.