Database Case: Commerce Company v. Real Estate Company
During the five-year transition period under the Foreign Investment Law Implementation Regulation, an existing foreign-invested enterprise that seeks to realign its governance under the Company Law must still comply with the allocation of authority and procedures set by its original joint-venture contract and articles, and must first adopt a valid amending resolution under that original framework. A shareholders' resolution that bypasses those original governance documents should be rescinded.
Holding
During the five-year transition period under the Foreign Investment Law Implementation Regulation, an existing foreign-invested enterprise that seeks to realign its governance under the Company Law must still comply with the allocation of authority and procedures set by its original joint-venture contract and articles, and must first adopt a valid amending resolution under that original framework. A shareholders' resolution that bypasses those original governance documents should be rescinded.