Regulation of Corporate Groups in China

This paper has examined the regulatory framework of corporate groups doing business in China. It is clear that although China has not codified corporate groups in a separate chapter or statute, corporate groups are still protected and regulated by different legal branches, including but not confined to company law, securities law, anti-trust tax law and environmental law. The fiduciary duty of the parent company, the protection of minority shareholders and public investors of the subsidiary, the protection of creditors of the subsidiary, and the strengthening of corporate social responsibility in the subsidiary and the corporate group as a whole will continue to be significant issues in the future. Globalization represents both challenges and opportunities for China to further reform its regulatory framework of corporate groups based on best practice in Germany and other jurisdictions. The goals of legal reform of corporate groups in this regard is to enable Chinese corporate groups to be strong and globalized, to encourage foreign corporate groups to enter the Chinese market, and to promote an inclusive and sustainable win-win business ecology between and among corporate groups and all relevant stakeholders.