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A Comparative Analysis of Directors’ Liability in China and the Netherlands

image of European Journal of Comparative Law and Governance

Pursuant to article 149 Company Law of the People’s Republic of China 2013 (clc), directors will be liable for the damages of the company if their actions violate the law, administrative regulations, or the company’s statutes. According to article 152 clc, directors will also face liability towards the company’s shareholders in case of a violating action that caused direct damages to the shareholders. Unfortunately, however, these provisions and their corresponding legal obligations are general and offer no procedural guidance, nor do they elaborate on the scope and extent of the directors’ personal liability. Furthermore, it is by and large ambiguous what the directors’ responsibilities are towards the creditors of the company. This article discusses this grey area of the clc by critically comparing it with the Dutch system of directors’ liability. Upon analysis, the author proposes to introduce a standard of fault in China to determine the scope and extent of the directors’ personal liability. In addition, the author argues that China should provide the company’s creditors with a direct action against the directors for compensation of their real damages.

Affiliations: 1: LL.M candidate, Peking University, China,


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