Reference Case: Meizhou Jin Company Agency-Sales Contract Dispute
The Xingning People's Court held in a model case released by the Guangdong High Court that the shareholder-controlled affiliate and the operating company had lost separate personality because the controlling company arranged a nominee legal representative, controlled the operating company's seals and bank accounts, and shared offices and staff with it. The court therefore pierced the corporate veil and ordered the operating company to pay the outstanding price and interest, with the controlling affiliate jointly liable.
Holding
The Xingning People's Court held in a model case released by the Guangdong High Court that the shareholder-controlled affiliate and the operating company had lost separate personality because the controlling company arranged a nominee legal representative, controlled the operating company's seals and bank accounts, and shared offices and staff with it. The court therefore pierced the corporate veil and ordered the operating company to pay the outstanding price and interest, with the controlling affiliate jointly liable.