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| Category | LEGAL PERSONS AND ECONOMIC ORGANIZATIONS | Organ of Promulgation | The Standing Committee of the National People's Congress | Status of Effect | In Force |
| Date of Promulgation | 1997-02-23 | Effective Date | 1997-08-01 |
|
Law of the People's Republic of China on Partnership Enterprises |
|---|
Chapter I General Provisions
Chapter II Establishment of Partnership Enterprises
Chapter III Partnership Enterprises' Property
Chapter IV Execution of Partnership Enterprise Affairs
Chapter V Relations of Partnership Enterprises to Third Parties
Chapter VI Entering into and Withdrawing from Partnerships
Chapter VII Disbandment and Liquidation of Partnership Enterprises
Chapter VIII Legal Liability
Chapter IX Supplementary Provisions Article 1 This Law is formulated with a view of standardizing partnership Article 2 "Partnership enterprise" mentioned in this Law refers to a Article 3 A partnership agreement shall be in written form after Article 4 In concluding a partnership agreement and establishing a Article 5 Partnership enterprises shall not use words such as "limited" Article 6 In engaging in business activities, partnership enterprises Article 7 Property, legitimate rights and interests of partnership Article 8 The following conditions shall be fulfilled for the (1) two or more partners each of which to bear unlimited liability (2) a written partnership agreement; (3) capital contributions actually made by each of partners; (4) the name of the partnership enterprise; and (5) the place of business and conditions necessary for partnership Article 9 A partner shall be a person with full capacity for civil Article 10 Those prohibited by laws or administrative regulations from Article 11 A partner may make his capital contributions in currency, or Capital contributions in other forms than in currency may, if necessary, A partner may provide personal services as capital contributions after Article 12 Partners shall perform their duties of capital contribution in Capital contributions actually made by each of the partners according to Article 13 A partnership agreement shall include the following items: (1) the name of the partnership enterprise and address of its place of (2) the purpose of partnership and the business scope of the partnership (3) names and residences of each partner; (4) the form, amount and time limit for each partner to make capital (5) the method of distributing profits and undertaking risks; (6) execution of the partnership enterprise's affairs; (7) entering into and withdrawal from partnership; (8) disbandment and liquidation of the partnership enterprise; and (9) default liability. A partnership agreement may include the operation term of the partnership Article 14 A partnership agreement takes effect upon the signing and The partnership agreement may be revised or supplemented if all the Article 15 Anyone who applies for registration of the establishment of a Where it is required by laws or administrative regulations that the Article 16 The enterprise registration authority shall, within 30 days as Article 17 The date of the issuance of the partnership enterprise's No partner may engage in any profit-making activities in the name of the Article 18 A partnership enterprise intending to establish a branch shall Article 19 During the period in which a partnership enterprise exists, Property of a partnership enterprise shall be under the unified management Article 20 Partners shall not claim the partitioning of property of the If partners privately transfer or dispose of the property of the Article 21 During the period in which a partnership enterprise exists, The transfer of all or part of the shares of property in the partnership Article 22 Where a partner transfers his share of property according to Article 23 Where those who are not partners, with the consent of all the Article 24 Where a partner puts his share of property in the partnership If a partner, without the consent of all other partners, puts his share of Article 25 Each partner shall have the equal right to execute the The partner executing the partnership enterprise's affairs shall Article 26 Where one or more partners has(have) been authorized to Partners not participating in the execution of affairs shall have the Article 27 Where one or more partners execute(s) the partnership Article 28 Partners shall have the right to consult the account book for Where partners make decisions on items relevant to the partnership Article 29 Where partners separately execute the partnership enterprise's If the partner(s) authorized to execute the partnership enterprise's Article 30 Partners shall not individually or in co-operation with others Partners shall not trade with their partnership enterprise except Partners shall not engage in any activity damaging the interests of the Article 31 The execution of the following affairs in a partnership (1) disposing of real estate of the partnership enterprise; (2) changing the name of the partnership enterprise; (3) transferring or disposing of intellectual property rights or other (4) applying to the enterprise registration authority for registration of (5) offering others a security on behalf of the partnership enterprise; (6) appointing persons who are not partners to act as managerial (7) dealing with other relevant affairs as agreed upon in the partnership Article 32 Partners shall share profits and losses of the partnership A partnership agreement shall not stipulate for the distribution of all Article 33 During the period in which the partnership enterprise exists, Article 34 The annual or periodic plan detailed for profit distribution Article 35 Managerial executives appointed by a partnership enterprise Managerial executives appointed by a partnership enterprise who exceed the Article 36 Partnership enterprises shall establish their enterprise Article 37 Partnership enterprises shall perform the duty of paying taxes Article 38 No restrictions imposed by a partnership enterprise on rights Article 39 A partnership enterprise shall pay off its debts first out of Article 40 Where a partnership enterprise pays its debts out of its Any partner who overpays his share of the debts to bear the joint Article 41 A creditor of one partner of a partnership enterprise shall Article 42 Where a partner owes personal debts, his creditor shall not Article 43 Where a partner's own property is not sufficient to pay off The other partners shall have priority in acquiring the property shares of Article 44 A person intending to enter into partnership shall obtain the In concluding the entering agreement, the original partners shall inform Article 45 A partner newly entering into the partnership shall enjoy The new partner shall undertake joint liability for the debts of the Article 46 Where the partnership agreement stipulates the period of (1) Facts resulting in withdrawal from partnership as agreed upon in the (2) The withdrawal from partnership has been approved by all the partners; (3) Facts resulting in difficulties for partners to continue participation (4) The other partners have seriously broken the duties as agreed upon in Article 47 Where the partnership agreement does not stipulate the period Article 48 A partner unilaterally withdrawing from partnership in Article 49 A partner shall naturally withdraw from a partnership under (1) Where he dies or is declared dead according to law; (2) Where he is declared a person having no capacity for civil conduct; (3) Where he loses personal capacity for paying debts; or (4) Where all his property shares in the partnership enterprise have been The withdrawal from partnership as stipulated in the preceding paragraph Article 50 A partner may be removed by decision of the other partners (1) Where he fails to perform the obligation of capital contributions; (2) Where he intentionally or through gross negligence causes losses to (3) Where he acts improperly in executing the affairs of the partnership (4) Where other facts occur as agreed upon in the partnership agreement. A decision on removal of a partner shall be notified in writing to the The removed person may, within 30 days from the date receiving the notice Article 51 Where a partner dies or is declared dead according to law, his If the legal successor is unwilling to be a partner, the partnership If the legal successor is a minor, his guardian may, with the consent of Article 52 Where a partner withdraws from partnership, the other partners In the case of unsettled affairs in a partnership enterprise at the time Article 53 The method for returning property shares in the partnership Article 54 A withdrawing partner shall bear liability jointly with the Article 55 Where property of a partnership enterprise is less than its Article 56 Where the registered items of a partnership enterprise Article 57 A partnership enterprise shall be disbanded under any of the (1) The period of operation as agreed upon in the partnership agreement (2) The facts resulting in the disbandment as agreed upon in the (3) The disbandment has been decided upon by all the partners; (4) Partners have not formed the statutory number; (5) The purpose of partnership has been achieved or cannot be achieved as (6) The business licence has been revoked according to law; or (7) Other reasons stipulated in laws and administrative regulations for Article 58 A partnership enterprise shall be liquidated after being Article 59 The liquidators of a partnership enterprise after its In case of failure to appoint the liquidators within 15 days, partners or Article 60 Liquidators shall execute the following affairs during (1) checking up on the property of the partnership enterprise, and (2) disposing of the unsettled affairs relevant to the liquidation of the (3) paying off taxes owed by the enterprise; (4) clearing up claims and debts; (5) disposing of, after paying off the debts of the partnership (6) participating in civil lawsuits on behalf of the partnership Article 61 The property of a partnership enterprise shall, after the (1) wages of employees and labour insurance expenses owed by the (2) taxes owed by the partnership enterprise; (3) debts incurred by the partnership enterprise; and (4) capital contributions returnable to partners. With regard to the remaining property of a partnership enterprise after Article 62 Where all property of a partnership enterprise is not Article 63 After the disbandment of a partnership enterprise, its Article 64 Upon the completion of liquidation, a liquidation report shall Article 65 Any violator of this Law who offers false documents or resorts Article 66 Any violator of this law who uses words such as "limited" or Article 67 Any violator of this law who engages in business activities in In case of a change in the registered items, a partnership enterprise that Article 68 Any partner who, in executing partnership affairs, Article 69 Any partner who without authorization disposes of partnership Article 70 Any partner not authorized to execute the partnership affairs Article 71 Any partner who, in violation of the provisions of Article 30 Article 72 Any employee of a partnership enterprise who takes advantage Article 73 Any liquidator who fails to submit the liquidation report to Article 74 Any partner acting as a liquidator who seeks illegal income or A liquidator authorized by partners who commits the act stipulated in the Article 75 Any liquidator who, in violation of the provisions of this Article 76 A partner breaking the partnership agreement shall bear If a dispute over the performance of the partnership agreement arises, Article 77 Administrative organs concerned and their personnel who, in Article 78 This Law shall come into force on August 1, 1997.
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Chapter I General Provisions
enterprises' activities, protecting the legitimate rights and interests of
partnership enterprises and their partners, maintaining the social and
economic order, and promoting the development of the socialist market economy.
profit-making organization established within the territory of China according
to this Law with their partners associated under a partnership agreement, each
making capital contributions, carrying out business operations, distributing
profits, undertaking risks and bearing unlimited and joint liability for the
partnership enterprise's debts.
consultation and agreement among all the partners according to law.
partnership enterprise, the parties shall follow the principles of
voluntariness, equality, fairness, honesty and credibility.
or "limited liability" in their names.
must observe laws and administrative regulations and abide by professional
ethics.
enterprises and their partners shall be protected by law.
Chapter II Establishment of Partnership Enterprises
establishment of a partnership enterprise:
according to law;
operations.
conduct.
engaging in profit-making activities shall not be partners of a partnership
enterprise.
by providing material objects, land use rights, intellectual property rights
or other property rights. The capital contributions above-mentioned shall be
legal property or property rights owned by the partner.
be appraised and evaluated by all the partners through consultation, or by a
statutory evaluation institution with the authorization of all the partners.
consultation and agreement among all the partners. The evaluation of
contributions in the form of services shall be determined by all the partners
through consultation.
terms of the form, amount and time limit of such contribution, as agreed upon
among them in the partnership agreement.
the partnership agreement shall be regarded as contributing to the partnership
enterprise.
business;
enterprise;
contributions;
enterprise and the means of dispute settlement among partners.
sealing by all the partners of the partnership agreement. Any partner shall
enjoy rights and undertake liabilities according to the partnership agreement.
partners reach agreement through consultation.
partnership enterprise shall submit to the enterprise registration authority
documents such as a written application for registration, a partnership
agreement and partners' identity certificates.
establishment of the partnership enterprise must be subject to the examination
and approval by the department concerned, the applicant shall submit an
approval document in applying for registration of establishment.
of the date of receiving the documents of application for registration, make a
decision whether or not to grant registration. It shall grant registration and
issue a business licence to the applicants that meet the requirements
stipulated in this Law, and shall not grant registration to those who fail to
meet the requirements stipulated in this Law and give them a written reply
explaining the reasons.
business licence shall be the date of the establishment of a partnership
enterprise.
partnership enterprise that has not yet taken out the business licence.
apply for the registration of establishment of the branch to the enterprise
registration authority in the place where the branch is to be located for a
business licence.
Chapter III Partnership Enterprises' Property
capital contributions made by partners and all proceeds earned on behalf of
the partnership enterprise shall be the property of the partnership enterprise.
and use of all the partners according to this Law.
partnership enterprise before the liquidation of the enterprise unless
otherwise provided for by this Law.
partnership enterprise before the liquidation of the enterprise, the
partnership enterprise shall not on that ground act against a third party who
has acted in good faith and has not informed of the case.
any partner who intends to transfer to a person who is not one of the partners
all or part of his property shares in the partnership enterprise must obtain
the consent of all other partners.
enterprise between partners shall be notified to the other partners.
law, the other partners shall, on identical terms, have priority in acquiring
the share.
partners, acquire shares of property in the partnership enterprise according
to law, they shall become the partners of the partnership enterprise upon the
modification of the partnership agreement and shall enjoy rights and undertake
liabilities according to the modified partnership agreement.
enterprise in pledge, he shall obtain the consent of all other partners.
property in the partnership enterprise in pledge, his act shall be void or
treated as withdrawal from partnership. If he thereby causes losses to the
other partners, he shall bear liability for compensation according to law.
Chapter IV Execution of Partnership Enterprise Affairs
partnership enterprise's affairs. All the partners may jointly execute the
enterprise's affairs, or, as agreed upon in the partnership agreement or by
decision of all the partners, authorize one or more partners to execute the
enterprise's affairs.
externally represent the partnership enterprise.
execute the partnership enterprise's affairs as stipulated in the preceding
Article, the other partners shall no longer execute the enterprise's affairs.
right to supervise the partners executing affairs and inspect the execution.
enterprise's affairs, the partner(s) shall report the execution of affairs,
the business operations and financial condition of the partnership enterprise
to the other partners not participating in the execution of affairs. Proceeds
earned in the execution of the partnership enterprise's affairs shall belong
to all the partners and losses and civil liability incurred therefrom be
undertaken by all the partners.
finding out about the business operations and financial condition of the
partnership enterprise.
enterprise according to law or the partnership agreement, unless otherwise
provided for by this Law or by the partnership agreement, the items may, by
decision of all the partners, be decided on a one-person-one-vote basis.
affairs as agreed upon in the partnership agreement or by decision of all the
partners, any of partners may address oppositions to the other partners on the
execution of affairs. If an opposition is addressed, the execution of the
affairs involved shall be suspended. In case of occurrence of a dispute, all
the partners may jointly make a decision thereon.
affairs fail(s) to act in accordance with the partnership agreement or the
decision of all the partners, the other partners may make a decision to
withdraw such authorization.
engage in businesses competitive with their partnership enterprise.
otherwise agreed upon in the partnership agreement or with the consent of all
the partners.
partnership enterprise.
enterprise shall be subject to the consent of all the partners:
property rights of the partnership enterprise;
changes;
executives of the partnership enterprise; or
agreement.
enterprise in proportion as agreed upon in the partnership agreement. In
absence of stipulations for such proportion in the partnership agreement, each
partner shall share profits and losses equally.
profits to part of the partners or for the sharing of all losses among part of
the partners.
partners may, as agreed upon in the partnership agreement or by decision of
all the partners, increase their capital contributions to the partnership
enterprise for the purpose of expanding the business scale or making up losses.
and loss sharing in a partnership enterprise shall be decided through
consultation of all the partners or as agreed upon in the partnership
agreement.
shall perform their duties within the scope of power authorized by the
partnership enterprise.
scope of power authorized by the partnership enterprise in engaging in
business activities, or cause losses to the enterprise intentionally or
through gross negligence shall bear the liability for compensation according
to law.
financial and accounting systems in accordance with the provisions of laws and
administrative regulations.
according to the laws.
Chapter V Relations of Partnership Enterprises to Third Parties
of a partner to execute the enterprise's affairs and externally represent the
enterprise may act against a third party who has acted in good faith and has
not been informed of the case.
all its property. If the property of the partnership enterprise is
insufficient to pay off its due debts, each partner shall bear the unlimited
and joint liability for paying off debts.
property and the debts cannot be paid off in full, each partner shall repay
the difference with his property other than his capital contributions to the
partnership enterprise in proportion as stipulated in the first paragraph of
Article 32 of this Law.
liability shall have the right to claim compensation from the other partners.
not set off the creditor's rights against his debts owed to the partnership
enterprise.
take his place in the partnership enterprise to exercise the partner's rights.
his personal debts, the partner may pay the debts out of his proceeds shared
in the partnership enterprise. Alternately, the creditor may apply to a
people's court for compulsory execution of the property shares of the partner
in the partnership enterprise to pay off the debts.
the partner.
Chapter VI Entering into and Withdrawing from Partnerships
consent of all original partners and shall conclude a written entering
agreement according to law.
the new partner of the business operations and financial condition of the
partnership enterprise.
the equal rights and undertake equal liabilities with the original partners.
If, however, otherwise stipulated in the entering agreement, such stipulations
shall prevail.
partnership enterprise incurred before he enters into the partnership.
operation of the partnership enterprise, partners may withdraw from the
partnership under any of the following circumstances:
partnership agreement occur;
in the partnership enterprise occur; or
the partnership agreement.
of operation of the partnership enterprise, partners may withdraw from
partnership without adversely affecting the execution of affairs in the
partnership enterprise and shall inform the other partners 30 days before.
violation of the provisions of the two preceding articles shall compensate for
losses caused to the other partners.
any of the following circumstances:
executed by a people's court.
shall take effect on the date the fact occurs.
through agreement under any of the following circumstances:
the partnership enterprise;
enterprise; or
removed person. The removal shall take effect in the result of the withdrawal
of the removed person on the date when he receives the notice.
of removal, bring a lawsuit to a people's court if he refuses to accept the
decision on his removal.
successor who is legally entitled to the property shares in the partnership
enterprise shall, as agreed upon in the partnership agreement or with the
consent of all the partners, have the status of the partner as of the date the
succession begins.
enterprise shall return the property shares he inherits according to law.
the other partners, exercise rights on his behalf till the minor comes of age.
shall clear accounts with him under the financial condition of the partner
enterprise at the time of his withdrawal and shall return his property shares.
of a withdrawal from the partnership, the clearance of accounts shall be
carried out upon settlement of such affairs.
enterprise to a withdrawing partner shall be stipulated in the partnership
agreement or decided by all the partners. The shares may be returned to the
withdrawing partner in currency or in kind.
other partners for debts of the partnership enterprise incurred before his
withdrawal from partnership.
debts at the time of a partner's withdrawal, the partner shall share the
losses according to the provisions of the first paragraph of Article 32 in
this Law.
change, or need to be renewed, due to entering into or withdrawal from
partnership, a revision of the partnership agreement or for other reasons, the
partnership enterprise shall, within 15 days from the date of making the
decision on changes or the facts occur, apply to the enterprise registration
authority for such registration.
Chapter VII Disbandment and Liquidation of Partnership Enterprises
following circumstances:
expires and partners are unwilling to continue the operations;
partnership agreement occur;
agreed upon in the partnership agreement;
the disbandment of the partnership enterprise arise.
disbanded and shall notify its creditors by notice or announcement.
disbandment shall be composed of all the partners. If the partners are not all
eligible, one or more partners or a third party may, with the consent of over
half of all the partners and within 15 days after the disbandment of the
enterprise, be appointed as the liquidator(s).
other interested persons may apply to a people's court for the appointment of
liquidators.
liquidation:
separately formulating a balance sheet and a detailed inventory of property;
partnership enterprise;
enterprise, its remaining property; and
enterprise.
payment of liquidation expenses, be applied to make repayment in the following
order:
partnership enterprise;
repayment in the order abovementioned, it shall be distributed in proportion
as stipulated in the first paragraph of Article 32 in this Law.
sufficient to pay off its debts at the time of liquidation, the provisions of
Articles 39 and 40 in this Law shall apply.
original partners shall continue to be jointly liable for debts incurred by
the enterprise during the period in which the enterprise exists. If, however,
the creditors fail to claim the repayment of debts within five years, the
liability for repayment shall extinguish.
be formulated and shall, bearing the signatures and seals of all the partners,
be submitted to the enterprise registration authority within 15 days for the
registration of cancellation of the partnership enterprise.
Chapter VIII Legal Liability
to other deceptive means and is thereby granted enterprise registration, shall
be ordered to make corrections and may be fined not more than 5,000 yuan; if
the circumstances are serious, the enterprise registration shall be revoked.
"limited liability" in the name of a partnership enterprise shall be ordered
to make corrections and may be fined not more than 2,000 yuan.
the name of a partnership enterprise without taking out a business licence
according to law, shall be ordered to stop business activities and may be
fined not more than 5,000 yuan.
fails to register such a change according to the provisions of this Law shall
be ordered to apply for the registration within a time limit. It shall be
fined not more than 2,000 yuan for failure to register the change within the
time limit.
misappropriates the interests which ought to belong to the partnership
enterprise, or seizes the partnership property by other means, shall be
ordered to return the interests or property to the partnership enterprise. If
he causes losses to the partnership enterprise or the other partners, he shall
bear the liability for compensation according to law. If a crime has been
constituted, criminal liability shall be investigated according to law.
affairs, the execution of which shall be subject to the consent of all the
partners as stipulated in this Law or in the partnership agreement, and
thereby causes losses to the partnership enterprise or the other partners,
shall bear the liability for compensation according to law.
who executes the affairs and thereby causes losses to the partnership
enterprise or the other partners, shall bear the liability for compensation
according to law.
in this Law, engages in businesses competitive with his partnership enterprise
or trades with their enterprise and thereby causes losses to the enterprise or
the other partners, shall bear the liability for compensation according to law.
of his position to seize the partnership property or convert the partnership
assets to his own use, shall bear civil liability for compensation according
to law. If a crime has been constituted, criminal liability shall be
investigated according to law.
the enterprise registration authority as stipulated in this Law, or conceals
major facts or omits important information in the liquidation report
submitted, shall be ordered to make corrections.
seizes the partnership property in conducting liquidation shall be ordered to
return the income or property to the partnership enterprise. If a crime has
been constituted, criminal liability shall be investigated according to law.
preceding paragraph shall be ordered to return the income or property to the
partnership enterprise and shall bear the liability for compensation according
to law. If a crime has been constituted, criminal liability shall be
investigated according to law.
Law, conceals or transfers the partnership property, makes false entries in
the balance sheet or in the detail inventory of property, or distributes the
partnership property before paying off debts, shall be ordered to make
corrections. If losses have been caused to the creditors, the offender shall
bear liability for compensation according to law. If a crime has been
constituted, criminal liability shall be investigated according to law.
liability for the breach according to law.
partners may settle it through consultation or mediation. If partners are
unwilling to settle their dispute through consultation or mediation, or if
consultation or mediation is unsuccessful, they may, in accordance with the
arbitration clause provided in the partnership agreement or a written
arbitration agreement reached by the partners afterwards, apply to an
arbitration body for arbitration. If no arbitration clause is provided in the
partnership agreement, and a written arbitration agreement is not reached
afterwards, the partners may bring a lawsuit to a people's court.
violation of the provisions of this Law, abuse their powers, engage in
malpractices for personal gains, take bribes or infringe over legitimate
interests of partnership enterprises, shall be given disciplinary sanctions
according to law. If a crime has been constituted, criminal liability shall be
investigated according to law.
Chapter IX Supplementary Provisions
URL: http://www.asianlii.org/cn/legis/cen/laws/pe270