Section 1 General Stipulations Article 36
A legal person shall be an organization that has capacity for civil
rights and capacity for civil conduct and independently enjoys civil
rights and assumes civil obligations in accordance with the law.
A legal person's capacity for civil rights and capacity for civil
conduct shall begin when the legal person is established and shall
end when the legal person terminates.
Article 37
A legal person shall have the following qualifications:
(1) establishment in accordance with the law;
(2) possession of the necessary property or funds;
(3) possession of its own name, organization and premises; and
(4) ability to independently bear civil liability.
Article 38
In accordance with the law or the articles of association of the
legal person, the responsible person who acts on behalf of the legal
person in exercising its functions and powers shall be its legal
representative.Article 39
A legal person's domicile shall be the place where its main
administrative office is located.
Article 40
When a legal person terminates, it shall go into liquidation in
accordance with the law and discontinue all other activities.
Section 2 Enterprise as Legal Person Article 41
An enterprise owned by the whole people or under collective ownership
shall be qualified as a legal person when it has sufficient funds as
stipulated by the state; has articles of association, an organization
and premises; has the ability to independently bear civil liability;
and has been approved and registered by the competent authority.
A Chinese-foreign equity joint venture, Chinese-foreign contractual
joint venture or foreign-capital enterprise established within the
People's Republic of China shall be qualified as a legal person in
China if it has the qualifications of a legal person and has been
approved and registered by the administrative agency for industry
and commerce in according with the law.
Article 42
An enterprise as legal person shall conduct operations within the
range approved and registered.
Article 43
An enterprise as legal person shall bear civil liability for the
operational activities of its legal representatives and other
personnel.
Article 44
If an enterprise as legal person is divided or merged or undergoes
any other important change, it shall register the change with the
registration authority and publicly announce it.
When an enterprise as legal person is divided or merged, its rights
and obligations shall be enjoyed and assumed by the new legal person
that results from the change.
Article 45
An enterprise as legal person shall terminate for any of the
following reasons:(1) if it is dissolved by law;
(2) if it is disbanded;
(3) if it is declared bankrupt in accordance with the law; or
(4) for other reasons.
Article 46
When an enterprise as legal person terminates, it shall cancel its
registration with the registration authority and publicly announce
the termination.
Article 47
When an enterprise as legal person is disbanded, it shall establish
a liquidation organization and go into liquidation. When an enterprise
as legal person is dissolved or is declared bankrupt, the competent
authority or a people's court shall organize the organs and personnel
concerned to establish a liquidation organization to liquidate the
enterprise.
Article 48
An enterprise owned by the whole people, as legal person, shall bear
civil liability with the property that the state authorizes it to
manage. An enterprise under collective ownership, as legal person,
shall bear civil liability with the property it owns. A Chinese-foreign
equity joint venture, Chinese-foreign contractual joint venture or
foreign-capital enterprise as legal person shall bear civil liability
with the property it owns, except as stipulated otherwise by law.
Article 49
Under any of the following circumstances, an enterprise as legal
person shall bear liability, its legal representative may additionally
be given administrative sanctions and fined and, if the offence
constitutes a crime, criminal responsibility shall be investigated
in accordance with the law:
(1) conducting illegal operations beyond the range approved and
registered by the registration authority;
(2) concealing facts from the registration and tax authorities
and practising fraud;
(3) secretly withdrawing funds or hiding property to evade
repayment of debts;
(4) disposing of property without authorization after the
enterprise is dissolved, disbanded or declared bankrupt;
(5) failing to apply for registration and make a public
announcement promptly when the enterprise undergoes a change or
terminates, thus causing interested persons to suffer heavy
losses;
(6) engaging in other activities prohibited by law, damaging the
interests of the state or the public interest.
Section 3 Official Organ, Institution and Social Organization as Legal Person Article 50
An independently funded official organ shall be qualified as a legal
person on tbe day it is established.
If according to law an institution or social organization having
the qualifications of a legal person needs not go through the
procedures for registering as a legal person, it shall be qualified
as a legal person on the day it is established; if according to law
it does need to go through the registration procedures, it shall be
qualified as a legal person after being approved and registered.
Section 4 Economic Association Article 51
If a new economic entity is formed by enderprise and an institution
that engage in economic association and it independently bears civil
liability and has the qualifications of a legal person, the new
entity shall be qualified as a legal person after being approved and
registered by the competent authority.
Article 52
If the enterprises or an enterprise and an institution
that engage in economic association conduct joint operation but
do not have the qualifications of a legal person, each party to
the association shall, in proportion to its respective
contribution to the investment or according to the agreement
made, bear civil liability with the property each party owns or
manages.If joint liability is specified by law or by agreement,
the parties shall assume joint liability.
Article 53
If the contract for economic association of enterprises or of an
enterprise and an institution specifies that
each party shall conduct operations independently, it shall
stipulate the rights and obligation of each party, and each party
shall bear civil liability separately.
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