Article 38 The shareholders
meeting shall exercise the following functions
and powers:
(1) to decide on the business
policy and investment plan of the company;
(2) to elect and recall members of
the board of directors and to decide on matters
concerning the remuneration of directors;
(3) to elect and recall
supervisors appointed from among the
shareholders representatives, and to decide on
matters concerning the remuneration of
supervisors;
(4) to examine and approve reports
of the board of directors;
(5) to examine and approve reports
of the supervisory board or supervisors;
(6) to examine and approve the
annual financial budget plan and final accounts
plan of the company;
(7) to examine and approve plans
for profit distribution of the company and plans
for making up losses;
(8) to adopt resolutions on the
increase or reduction of the registered capital
of the company;
(9) to adopt resolutions on the
issuance of company bonds;
(10) to adopt resolutions on the
assignment of capital contribution by a
shareholder to a person other than the
shareholders;
(11) to adopt resolutions on
matters such as the merger, division,
transformation, dissolution and liquidation of
the company; and
(12) to amend the articles of
association of the company.
Article 39 The rules of
deliberation and voting procedures of the
shareholders meeting shall, except where
provided for by this Law, be stipulated by the
articles of association of the company.
Resolutions of the shareholders
meeting on the increase or reduction of the
registered capital, the division, merger,
dissolution, or transformation of the company
must be adopted by shareholders of the company
representing two-thirds or more of the voting
rights.
Article 40 A company may
amend its articles of association. A resolution
on the amendment to the articles of association
must be adopted by shareholders of the company
representing two-thirds or more of the voting
rights.
Article 41 Shareholders
shall exercise their voting rights at the
shareholders meeting in proportion to their
capital contributions.
Article 42 The first
meeting of the shareholders of a company shall
be convened and presided over by the shareholder
who has made the biggest capital contribution to
the company and shall exercise its functions and
powers in accordance with this Law.
Article 43 Shareholders
meetings shall be divided into regular meetings
and interim meetings.
Regular shareholders meetings
shall be convened on time as stipulated by the
articles of associations of the company. Interim
shareholders meetings may be convened upon
proposal made by shareholders representing
one-fourth or more of the voting rights, or, by
one-third or more of directors or
supervisors.
Where a limited liability company
has set up a board of directors, its
shareholders meeting shall be convened by the
board of directors and presided over by the
chairman of the board. Where special
circumstances preclude the chairman of the board
from performing his function, the meeting shall
be presided over by a vice-chairman or a
director of the board designated by the
chairman.
Article 44 All shareholders
shall be notified fifteen days prior to the
convening of a shareholders meeting.
The shareholders meeting shall
keep minutes of their decisions on matters
discussed at it; the shareholders present at the
meeting shall sign the minutes.
Article 45 A limited liability
company shall have a board of directors, which
shall be composed of three to thirteen
members.
The members of the board of
directors of a limited liability company
invested in the established by two or more
State-owned enterprises, or by two or more other
State-owned investment entities shall include
representatives of the staff and workers of the
company. Such representatives of the staff and
workers shall be democratically elected by the
staff and workers of the company.
A board of directors shall have a
chairman and one or two vice-chairmen. The
method for the creation of the chairman and
vice-chairmen shall be stipulated in the
articles of association of the company.
The chairman of the board of
directors shall be the companys legal
representative.
Article 46 The board of
directors shall be responsible to the
shareholders meeting, and exercise the following
functions and powers:
(1) to be responsible for
convening shareholders meetings and to report on
its work to the shareholders meetings;
(2) to implement the resolutions
of the shareholders meetings;
(3) to decide on the business
plans and investment plans of the company;
(4) to formulate the annual
financial budget plan and final accounts plan of
the company;
(5) to formulate plans for profit
distribution and plans for making up losses of
the company;
(6) to formulate plans for the
increase or reduction of the registered capital
of the company;
(7) to formulate plans for the
merger, division, transformation and dissolution
of the company;
(8) to decide on the establishment
of the companys internal management organs;
(9) to appoint or dismiss the
company's manager (general manager) (hereinafter
referred to as manager), and , upon
recommendation of the manager, to appoint and
dismiss the company's deputy manager(s) and
persons in charge of the financial affairs of
the company, and to decide on matters concerning
their remuneration; and
Article 47 The term of office
of directors shall be stipulated by the articles
of association of the company but may not exceed
three years. A director may, if reelected upon
expiration of his term of office, serve
consecutive terms.
The shareholders meeting of a
company may not unwarrantedly dismiss a director
of the board prior to the expiration of his term
of office.
Article 48 Meetings of the
board of directors shall be convened and
presided over by the chairman of the board.
Where special circumstances preclude the
chairman from performing his function, the
meeting shall be convened and presided over by a
vice-chairman or a director of the board
designated by the chairman. One-third or more of
the members of the board of directors may
propose the convening of a meeting of the board
of directors.
Article 49 The rules of
deliberation and voting procedures of the board
of directors shall, except where provided for by
this Law, be stipulated by the articles of
association of the company.
All directors shall be notified
ten days prior to the convening of a board
meeting.
The board meeting shall keep
minutes of decisions on matters discussed at it;
directors present at the meeting shall sign the
minutes.
Article 50 A limited liability
company shall have a manager, who shall be
appointed or dismissed by the board of
directors. The manager shall be responsible to
the board of directors and shall exercise the
following functions and powers:
(1) to be in charge of the
production, operation and management of the
company, and to organize the implementation of
the resolutions of the board of directors;
(2) to organize the implementation
of the annual business plans and investment
plans of the company;
(3) to draw up plans on the
establishment of the internal management organs
of the company;
(4) to draw up the basic
management system of the company;
(5) to formulate specific rules
and regulations of the company;
(6) to recommend the appointment
or dismissal of the deputy manager(s) and of
persons in charge of the financial affairs of
the company;
(7) to appoint or dismiss
management personnel other than those to be
appointed or dismissed by the board of
directors; and
(8) other functions and powers
granted by the articles of association of the
company and the board of directors.
The manager shall attend meetings
of the board of directors as a non-voting
attendant.
Article 51 Where a limited
liability company has a small number of
shareholders and is comparatively small in
scale, it may have an executive director instead
of a board of directors. The executive director
may concurrently serve as the manager of the
company.
The powers and functions of the
executive director shall be stipulated by the
articles of association of the company with
reference to Article 46 of this Law.
Where limited liability company
does not have a board of directors, the
executive director shall be the legal
representative of the company.
Article 52 A limited
liability company with a relatively large-scale
business shall have a supervisory board composed
of no less than three members. The supervisory
board shall elect a convener from among its
members.
The supervisory board shall be
composed of representatives of the shareholders
and an appropriate proportion of the staff and
workers of the company. The exact proportion
shall be stipulated in the articles of
association. The representatives of the staff
and workers in the supervisory board shall be
democratically elected by the staff and workers
of the company.
Where a limited liability company
has a small number of shareholders and is
comparatively small in scale, it may have one or
two supervisors.
Directors, the manager or
personnel in charge of financial affairs of the
company may not concurrently serve as
supervisors.
Article 53 The term of office
of a supervisor shall be three years. A
supervisor may, if reelected upon expiration of
his term of office, serve consecutive terms.
Article 54 The supervisory
board or the supervisors shall exercise the
following functions and powers:
(1) to examine the financial
affairs of the company;
(2) to supervise the acts of the
directors and the manager violating the laws,
administrative rules and regulations or the
articles of association of the company during
the performance of their functions;
(3) to demand directors and the
manager to make corrections if any of their acts
if found to have damaged the interests of the
company;
(4) to propose the convening of
interim shareholders meetings; and
(5) other functions and powers as
stipulated in the articles of association of the
company.
The supervisors shall attend
meetings of the board of directors as non-voting
participants.
Article 55 A company shall,
in studying and deciding on issues involving the
personal interests of its staff and workers such
as their salaries, welfare, safety in
production, labour protection and labour
insurance, solicit in advance the opinions of
the trade union and the staff and workers of the
company. And representatives of the trade union
or of the staff and workers shall be invited to
attend relevant meetings as non-voting
participants.
Article 56 A company shall
solicit the opinions and suggestions of the
trade union and the staff and workers of the
company when studying and deciding on major
issues concerning production and operation, and
formulating important rules and regulations.
Article 57 None of the
following persons may hold the position of
director, supervisor or manager of a
company:
(1) a person without capacity or
with restricted capacity for civil acts;
(2) a person who was sentenced to
cirminal punishment for the crime of
embezzlement, bribery, seizure of property or
misappropriation of property or for undermining
the socio-economic order, where not more than
five years have elapsed since the expiration of
the enforcement period; or a person who was
deprived of his political rights for committing
a crime, where not more than five years have
elapsed since the expiration of the enforcement
period;
(3) a director, or factory head or
manager who was personally responsible for the
bankruptcy liquidation of the company or
enterprise due to mismanagement, where not more
than three years have elapsed since the date of
completion of the bankruptcy liquidation;
(4) a legal representative of the
company or enterprise that had the business
license revoked for violating the law, where
such representative bear individual liability
therefor and not more than three years have
elapsed since the date of revocation of the
business license; and
(5) a person with relatively large
amount of personal debts that have fallen due
but haven't been settled.
Where a company elects or appoints
a director or supervisor or engages the manager
in violation of the preceding paragraph, such
election, appointment or engagement shall be in
valid.
Article 58 Government
functionaries may not concurrently serve as
directors, supervisors or managers of
companies.
Article 59 Directors,
supervisors and the manager of a company shall
comply with the articles of association of the
company, faithfully perform their duties and
maintain the interests of the company and shall
not take advantage of their position, functions
and powers in the company to seek personal
gains.
Directors, supervisors and the
manager of a company shall not, by taking
advantage of their functions and powers, accept
bribes or other unlawful incomes, nor may they
misappropriate the property of the company.
Article 60 Directors and the
manager of a company shall not misappropriate
company funds or lend company funds to
others.
Directors and the manager shall
not deposit company assets in their own personal
accounts or in personal accounts of other
individuals.
Directors and the manager shall
not use company assets as security for the
personal debts of shareholders of the company or
of other individuals.
Article 61 Directors and the
manager shall not operate their own in, or
operate for others, the same category of
business as the company they are serving or,
engage in activities which damage the interests
of the company. If a director or the manager
engages in such business or activities, the
incomes derived therefrom shall belong to the
company.
Directors and the manager shall
not enter into contracts or conduct transactions
with the company except as provided for in the
articles of association or approved by the
shareholders' meeting.
Article 62 Directors,
supervisors and the manager shall not disclose
any company secrets except as provided for by
the law or approved by the shareholders
meeting.
Article 63 Directors,
supervisors and the manager shall be liable for
compensation, if they violate the laws,
administrative rules and regulations or the
articles of association in performance of their
duties and thus cause damage to the company.
Section 3
Wholly State-owned Companies
Article 64 A wholly
State-owned company mentioned in this Law means
a limited liability company invested in and
established solely by the State-authorized
investment institution or a department
authorized by the State.
Companies which manufacture
special products as determined by the State
Council or companies that belong to the category
of specialized trades shall adopt the form of
wholly State-owned companies.
Article 65 The articles of
association of a wholly State-owned company
shall be formulated by the state-authorized
investment institution or a department
authorized by the State in accordance with this
Law, or be formulated by the board of directors
of the company and submitted for the approval of
the relevant State-authorized investment
institution or the department authorized by the
State.
Article 66 A wholly
State-owned company shall not have a
shareholders meeting. The State-authorized
investment institution or the department
authorized by the State shall authorize the
board of directors of the company to exercise
part of the functions and powers of the
shareholders meeting and to make decisions on
important matters of the company. However, the
merger, division, dissolution, increase and
reduction of capital, and issuance of company
bonds must be decided by the State-authorized
investment institution or by the department
authorized by the State.
Article 67 The
State-authorized investment institution or the
department authorized by the State shall
exercise supervision and administration over the
State-owned assets of the wholly State-owned
company in accordance with the provisions of the
laws and administrative rules and
regulations.
Article 68 A wholly
State-owned company shall have a board of
directors, which shall exercise its functions
and powers in accordance with the provisions of
Article 46 and Article 66 of this Law. Each term
of office of the board of directors shall be
three years.
The board of directors shall be
composed of three to nine members, who shall be
appointed and replaced by the State-authorized
investment institution or by the department
authorized by the State in accordance with the
term of office of the board of directors. The
board of directors shall include representatives
of the staff and workers of the company. The
representatives of the staff and workers on the
board of directors shall be democratically
elected by the staff and workers of the
company.
The board of directors shall have
a chairman and may have a vice-chairman, if
necessary. The chairman and vice-chairman shall
be designated by the State-authorized investment
institution or the department authorized by the
State from among members of the board of
directors.
The chairman of the board of
directors shall be the legal representative of
the company.
Article 69 A wholly
State-owned company shall have a manager, who
shall be engaged and dismissed by the board of
directors. The manager shall exercise his
functions and powers in accordance with the
provisions of Article 50 of this Law.
A member of the board of directors
may, subject to the consent of the
State-authorized investment institution or the
department authorized by the State, serve
concurrently as manager.
Article 70 The chairman,
vice-chairman and directors of the board, or the
manager of a wholly State-owned company may not,
without the consent of the State-authorized
investment institution or the department
authorized by the State, serve concurrently as
responsible persons in other limited liability
companies, joint-stock limited companies or
other business organizations.
Article 71 Where a wholly
State-owned company transfers its assets, the
procedures for examination and approval, and the
transfer of property rights shall be handled by
the State-authorized investment institution or
the department authorized by the State in
accordance with the laws and administrative
rules and regulations.
Article 72 Large-sized
wholly State-owned companies with a sound
business management system and relatively
successful operations may be authorized by the
State Council to exercise the rights of asset
owners.
Chapter III
Incorporation and Organizational
Structure
of Joint Stock Limited
Companies
Section 1
Incorporation
Article 73 To incorporate a
joint stock limited company, the following
conditions must be satisfied:
(1) the number of sponsors shall
conform to the statutory number;
(2) the share capital subscribed
for by the sponsors and raised from the general
public shall reach the statutory minimum amount
of capital;
(3) the issuance of shares and
preparations for incorporation shall be in
conformity with the provisions of the law;
(4) the articles of association of
the company shall be formulated by the sponsors
and adopted at the inaugural meeting;
(5) the company shall have a name
and an organizational structure required for the
incorporation of joint stock limited company;
and
(6) the company shall have fixed
premises and the necessary conditions for
production and operation.
Article 74 Joint stock limited
companies may be incorporated by means of
sponsorship or by means of share offer.
Incorporation by means of
sponsorship means incorporation of a company by
means of subscription by the sponsors for all
the shares to be issued by the company.
Incorporation by means of share
offer means incorporation of a company by means
of subscription by the sponsors for a portion of
the shares to be issued by the company and offer
of the rest to the general public.
Article 75 To incorporate a
joint stock limited company, there shall be five
or more sponsors, of which more than half must
have their domicile within the territory of the
People's Republic of China.
Where a State-owned enterprise is
restructured as a joint stock limited company,
there may be less than five sponsors, however,
such a company shall be incorporated by means of
share offer.
Article 76 The sponsors of
a joint stock limited company must subscribe in
accordance with this Law for the shares to be
subscribed for by them, and shall undertake the
matters concerning the preparation for the
incorporation of the company.
Article 77 The
incorporation of a joint stock limited company
must be subject to the approval of a department
authorized by the state Council or of a people's
government at the provincial level.
Article 78 The registered
capital of a joint stock limited company shall
be the total amount of paid-up share capital as
registered with the Company Registration
Authority.
The minimum registered capital of
a joint stock limited company shall be RMB 10
,000,000 yuan. If the minimum registered capital
of a joint stock limited company needs to be
higher than the aforesaid amount, it shall be
stipulated separately by the laws, or
administrative rules and regulations.
Article 79 The articles of
association of a joint stock limited company
shall specify the following items:
(1) the name and domicile of the
company;
(2) the scope of business of the
company;
(3) The method of incorporation of
the company;
(4) the total number of shares,
the amount of each shared and the registered
capital of the company;
(5)the names or titles of the
sponsors and the numbers of shares subscribed
for by the sponsors;
(6) the rights and obligations of
the shareholders;
(7) the composition, functions and
powers, the term of office and the deliberation
rules of the board of directors;
(8) the legal representative of
the company;
(9) the composition, functions and
powers, the term of office and the deliberation
rules of the supervisory board;
(10) methods for the distribution
of the company's profit;
(11) the reasons for dissolution
of the company and liquidation method;
(12) methods for notices and
announcements of the company; and
(13) other matters that the
shareholders general meeting deems necessary to
be specified.
Article 80 The sponsors may
make their capital contributions in cash, or
with material objects, industrial property
rights, non-patented technology or land-use
rights at their appraised value. Material
objects, industrial property rights,
non-patented technology or land-use rights
contributed as capital must be appraised and
valued, and such property must be verified and
converted into shares. Such contributions may
not be over-valued or under-valued. The
appraisal and valuation of land-use rights shall
be conducted in accordance with the provisions
of the laws, administrative rules and
regulations.
The amount of capital
contributions made by sponsors in the form of
industrial property rights and non-patented
technology shall not exceed twenty percent of
the registered capital of a joint stock limited
company.
Article 81 where a
State-owned enterprise is restructured as a
joint stock limited company, it shall be
strictly prohibited to convert the State-owned
assets into shares at a depressed price or to
sell off them at a depressed price, or to
distribute them to individuals without
charge.
Article 82 Where a joint
stock limited company is incorporated by means
of sponsorship, the sponsors shall pay in full
for their shares immediately after confirming in
writing their subscription of the shares to be
issued according to the articles of association
of the company. If material objects, industrial
property rights, non-patented technology or
land-use rights are invested as payment for
shares, the sponsors shall undertake the
transfer procedures for property rights therein
in accordance with the law.
After the sponsors make their
capital contributions in full, they shall elect
the board of directors and supervisory board.
The board of directors shall submit to the
Company Registration Authority the documents
such as approval document for the company's
incorporation, articles of association and
capital verification certificate of the company,
and shall apply for registration of
incorporation.
Article 83 Where a joint
stock limited company is incorporated by means
of share offer, the sponsors shall not subscribe
for less than thirty five percent of the total
shares issued by the company, and the remaining
shares shall be offered to the general
public.
Article 84 When offering
shares to the general public for subscription,
the sponsors must submit to the department of
security administration under the State Council
an application for share offer along with the
following main documents:
(1) the approval documents for the
incorporation of the company;
(2) the articles of association of
the company;
(3) a business forecast;
(4) the names or titles of the
sponsors, the number of shares subscribed for by
the sponsors, the forms of capital contributions
and the capital verification certificate;
(5) the prospectus on share
offer;
(6) the name and address of the
bank accepting subscription money on behalf of
the company; and
(7) the name of the selling
agencies and related agreements.
The sponsors shall not offer
shares to the general public without the
approval of the department of securities
administration under the State Council.
Article 85 A joint stock
limited company may, with the approval of the
department of security administration under the
State Council, offer its shares to the general
public outside the territory of the Peoples
Republic of China. The specific measures
therefor shall be specially stipulated by the
State Council.
Article 86 The department
of security administration under the State
Council shall approve the applications for share
offer which conform to the stipulations of this
Law, and disapprove the applications which fail
to conform to the stipulations of this Law.
If an approval is found to be
inconsistent with the stipulations of this Law
after it has been granted such approval shall be
revoked. If the share offer has not yet been
made, the offer shall be halted; if the share
offer has already been made, the subscribers may
claim a refund from the sponsors according to
their paid-up subscriptions plus bank deposit
interest calculated for the same period.
Article 87 A prospectus on
share offer shall have the articles of
association of the company formulated by the
sponsors attached, and shall specify the
following;
(1) then number of shares
subscribed for by the sponsors;
(2) the face value and the issue
price of each share;
(3) the total number of bearer
shares issued;
(4) the rights and obligations of
the subscribers; and
(5) the term of the share offer
and a statement to the effect that subscribers
may withdraw their share subscriptions if all
the shares are not taken up within the time
limit.
Article 88 Where shares are
to be offered to the general public, the
sponsors must publish the companys prospectus on
share offer and prepare subscription forms. The
subscription forms shall contain the items
listed in the preceding Article, and the
subscribers shall fill in the number of shares
subscribed for, the amount of money contributed
to, and their respective domiciles on the forms,
and shall sign and seal such forms. The
subscribers shall pay their subscription money
in accordance with the number of shares
subscribed for.
Article 89 When sponsors
offer shares to the public, the shares shall be
distributed by a securities agency established
according to law, with which a distribution
agreement shall be concluded.
Article 90 Where shares are
to be offered to the public, the sponsors shall
enter into an agreement with a bank on the
collection of subscription money on behalf of
the company.
The bank entrusted with collecting
the subscription money shall, in accordance with
its agreement, collect and keep the subscription
money, issue receipts to the subscribers for
their payments, and bear an obligation to issue
certification of receipt of subscription money
to the relevant departments.
Article 91 After payment in
full of the subscription money for all shares is
made, a statutory capital verification
institution shall be commissioned to conduct a
verification of the funds and produce a
verification certificate. The sponsors shall,
within thirty days thereafter, convene and
preside over an inaugural meeting composed of
all the subscribers.
If the number of shares has not
been fully subscribed for within the time limit
specified in the prospectus on share offer or,
after payment in full of the subscription money
for the total share is made, or if sponsors fail
to hold an inaugural meeting within thirty days
thereafter, the subscribers may claim a refund
from the sponsors according to the paid-up share
subscription money plus bank deposit interest
calculated for the same period.
Article 92 The sponsors
shall notify each subscriber of the date of the
inaugural meeting or make a public announcement
15 days prior to the convening of the meeting.
The inaugural meeting may be convened only if
subscribers representing fifty percent or more
of the total shares issued are present.
The following functions and powers
shall be exercised at an inaugural meeting:
(1) to examine the sponsors report
on the preparation for the incorporation of the
company;
(2) to adopt the articles of
association of the company;
(3) to elect members of the board
of directors;
(4) to elect members of the
supervisory board;
(5) to examine and verify the
expenses incurred in the incorporation of the
company;
(6) to examine and verify the
valuation of the property used by the sponsors
to pay for subscription money; and
(7) to resolve not to incorporate
the company in the event that a force majeure or
major changes in business operation conditions
may directly affect the incorporation of the
company.
The resolution made at the
inaugural meeting on the issues listed in the
preceding paragraph must be approved by
subscribers attending the meeting who represent
more than half of the voting rights.
Article 93 Sponsors and
subscribers may not withdraw their share capital
after paying their subscription money or making
their capital contributions as substitutes for
subscription money, except where the total share
issue is not fully subscribed for within the
time limit or the sponsors fail to convene the
inaugural meeting according to the schedule, or
the inaugural meeting resolves not to
incorporate the company.
Article 94 The board of
directors shall, within thirty days, after the
inaugural meeting, submit the following
documents to the Company Registration Authority
and apply for registration of the incorporation
of the company:
(1) the approval documents issued
by the relevant department in charge;
(2) the minutes of the inaugural
meeting;
(3) the articles of association of
the company;
(4) the financial audit report on
the preparation of the incorporation of the
company;
(5) the capital verification
certificate;
(6) the names and domiciles of the
members of the board of directors and the
supervisory board; and
(7) the name and domicile of the
legal representative.
Article 95 The Company
Registration Authority shall, within thirty days
after receipt of an application for the
incorporation of a joint stock limited company,
make a decision whether or not to register the
company. A company complying with the provisions
of this Law shall be registered and a company
business licence shall be issued thereto. a
company failing to comply with the provisions of
this Law shall not be registered.
The date of issuance of a company
business licence shall be the date of the
incorporation of the company. Once a company is
incorporated, and announcement shall be
made.
A joint stock limited company
incorporated by means of share offer shall,
after its registration for incorporation, report
its share subscription to the department of
security administration under the State Council
for the record.
Article 96 Where branches
are established simultaneously with the
incorporation of a joint stock limited company,
the company shall submit applications for
registration of the establishment of the
branches to, and obtain business licenses of the
branches from, the Company Registration
Authority.
Where branches are established
after the incorporation of a joint stock limited
company, the legal representative of the company
shall submit applications for registration of
the branches to, and obtain business licences of
the branches from, the Company Registration
Authority.
Article 97 The sponsors of
a joint stock limited company shall bear the
following responsibilities:
(1) in the event of the company
failing to be incorporated, joint and several
liabilities for all debts and expenses incurred
in the act of the incorporation;
(2) in the event of the company
failing to be incorporated, joint and several
liabilities for refunding to the subscribers the
paid-up subscription money plus bank deposit
interest calculated for the same period of time;
and
(3) in the event of the interests
of the company being damaged during the course
of its incorporation due to fault of the
sponsors, liability for compensation to the
company.
Article 98 If a limited
liability company is to be converted into a
joint stock limited company, it shall satisfy
the requirements for a joint stock limited
company stipulated by this Law and the
conversion shall be handled in accordance with
the procedures stipulated in this Law for the
incorporation of a joint stock limited
company.
Article 99 Where a limited
liability company is, after approval, converted
into a joint stock limited company in accordance
with the law, the total amount of its shares
converted shall be equal to the amount of its
net assets. Where a limited liability company
that is, after approval, converted into a joint
stock limited company in accordance with the law
offers shares to the general public for the
purpose of increasing its capital, it shall be
handled in accordance with the provisions of
this Law in respect of the share offers to the
public.
Article 100 Where a limited
liability company is converted into a joint
stock limited company in accordance with the
law, the claims and debts of the original
limited liability company shall be succeeded to
by the joint stock limited company into which it
is converted.
Article 101 A joint stock
limited company shall keep its articles of
association, roster of the shareholders, minutes
of the shareholders general meetings and
financial and accounting statements at the
company.
