From January to February this year, China's Ministry of Commerce (“MOFCOM”) successively issued Announcements No. 1 to No. 4 (2025) of the Working Mechanism of the Unreliable Entity List (“UEL”), adding 23 foreign entities to the list. This represents China's intensive use of this policy tool in a short period since the "Regulations on the Unreliable Entities List" (Decree No. 4 of the Ministry of Commerce in 2020, hereinafter referred to as the "Regulations") came into effect on September 19, 2020. The aim is to sanction foreign entities that endanger China's sovereignty and security and undermine the fairness of the international trade order. Prior to this, the only previous announcement by MOFCOM regarding UEL was on February 16, 2023, when two US military-industrial enterprises were included in the list.
The European Union greenhouse gas emission allowance trading system (hereinafter referred to as the “EU ETS”) is undoubtedly the largest and most mature carbon trading market in the world today, playing a leading role in global carbon reduction activities. Its core legal framework is based on Directive 2003/87/EC, issued by the European Union in 2003. The participating countries include all thirty members of the European Economic Area (EEA), which consists of the twenty-seven EU member states, as well as three countries from the European Free Trade Association (EFTA): Norway, Iceland, and Liechtenstein. Since its trial run in 2005 and full operation in 2008, the EU ETS’ application scope for industries has progressively expanded. Initially, it only applied to sectors such as energy, oil refining, steel, cement, glass, ceramics, and paper, and did not cover the transportation industry. However, with the amendment of Directive 2003/87/EC through Directive 2008/101/EC, the civil aviation sector was included in the scope of the EU ETS as of 1 January, 2012. The most recent development, in accordance with Directive 2023/959 issued in May 2023, is that the EU ETS also applies to the shipping sector starting 1 January, 2024.
Under the legal framework of the Company Law of the People’s Republic of China, the information rights are a fundamental right for company shareholders. However, in practice, due to the control of major shareholder(s) over company affairs, cases abound where minority shareholders cannot obtain information about the company, particularly financial status and operational details. This lack of transparency has led to numerous disputes over shareholder information rights. In any Joint-venture, if the foreign shareholders are located outside China, they face greater challenges in requiring company information compared to domestic minority shareholders.
On December 31, 2021, the Ministry of Ecology and Environment of the People's Republic of China issued a document stating that the first performance cycle of the national carbon emissions trading market has successfully ended. This is the first time that China has consolidated the responsibility for greenhouse gas emission control at the national level to enterprises, and it is also the first year which the national carbon market has officially been put into operation. According to the statistics of the Ministry of Ecology and Environment, a total of 2162 key emission units in the power generation industry were included in the first perfomance cycle of the national carbon market, covering an annual greenhouse gas emissions of approximately 4.5 billion tons of carbon dioxide. The cumulative trading volume of carbon emission quotas is 179 million tons, with a cumulative trading volume of 7.661 billion yuan and an average trading price of 42.85 yuan/ton., and The closing price on December 31 is 54.22 yuan/ton; The performance completion rate of the first performance cycle of the national carbon market is 99.5%; In terms of trading, the healthy and orderly operation of the national carbon market has initially shown its role in promoting enterprises to reduce greenhouse gas emissions and accelerate green and low-carbon transformation.
Equity, as the most important form of wealth aggregation for the vast majority of entrepreneurs, has both personal and property attributes. Therefore, unlike other forms of wealth inheritance for entrepreneurs, such as real estate, cash, and financial products, the legal issues involved in equity inheritance are also more complex and diverse. This article intends to analyze the current situation of entrepreneur equity inheritance based on relevant authoritative data reports, and then take Lin Qi, the former controlling shareholder and actual controller of the well-known online and mobile gaming platform "Youzu Network" in China, as an example to sum up and summarize how equity is allocated in the case of legal inheritance. Finally, starting from practical cases, analyze the key planning points of entrepreneur equity inheritance in parties’ intentional situations. (The cases mentioned in this article are all sourced from publicly available online information such as CNINFO and Sina Weibo, or adapted based on our handling of practical cases, without involving the privacy of the parties involved)
In March this year, Jotai’s perennial legal advisory unit sent a special demand for legal services, requiring the liquidation and withdrawal of three limited partnership enterprises and two limited liability companies directly invested by the actual controller. During the due diligence period, it was found that the actual controller's companies invested not only spans multiple industries, but also some of the invested companies have as many as a hundred shareholders. However, those companies’ articles of association are all simple templates and there are no clear provisions regarding the actual controller's concerns such as equity structure, consortium offer, voting rights, capital reduction or withdrawl.
With the continuous and vigorous development of the global new energy industry, major economic powers and multinational new energy giants have intensified their upstream development, which has also caused sharp fluctuations in the prices of bulk commodities, including lithium, copper, and cobalt. Chinese companies started their foray into African mining resources later than their Western counterparts. Currently, the top ten multinational companies involved in mining operations in Africa [1] are still dominated by Western companies. They are as follows: Anglo American plc, Rio Tinto Group, Vale S.A. (Brazil), BHP Billiton, Barrick Gold Corporation (Canada), Freeport-McMoRan Inc. (USA), Newmont Mining Corporation (USA), Teck Resources Limited (Canada), Kinross Gold Corporation (Canada), and Alcoa Inc. (USA). However, with the strong entry of Chinese enterprises, it is inevitable that it will lead to a reconfiguration of the mining investment strategic landscape.
As a direct financing tool for non-listed companies,equity investment has shown a rapid increase in transaction volume and capital scale in recent years. However, along with its rapid development, it has also generated many disputes and controversies. Therefore, we plan to launch a series of articles to provide an overview of the clauses and typical case analyses of common disputes in equity investment, including disputes related to performance-based guarantees, put options, preemptive rights, and liquidation preferences and summarize risk prevention insights from the perspectives of investors, target companies/original shareholders, and actual controllers.
As is well known, in recent years, "compliance" has become a hot topic that frequently appears in the public eye and has become a major trend in the development of enterprise management. Therefore, we plan to mainly start from the perspective of improving business management, select three common high-risk areas in enterprise operations: inter enterprise lending, contract control, and the performance of directors, supervisors, and senior executives, and launch three articles to sort out relevant compliance management points. This article will mainly focus on the performance of directors, supervisors, and senior executives. According to the Company Law of the People's Republic of China (2018 Amendment, hereinafter referred to as the "Company Law") and other relevant laws, as well as the provisions of the company's articles of association and other systems, directors, supervisors, and senior management personnel have certain rights of decision-making, supervision, and management in the operation of the enterprise.
Regarding the VAM agreement, at the judicial level, the current comprehensive regulations are the "Minutes of the National Court Work Conference for Civil and Commercial Trials" (Law [2019] No. 254, hereinafter referred to as the "Ninth Minutes"), which emphasizes the effectiveness and performance of VAM agreements. The "Ninth Minutes" emphasize that in terms of legal application, “When hearing disputes over VAM agreements, the people's court should not only apply the relevant provisions of the Contract Law, but also the relevant provisions of the Company Law. It should not only adhere to the principle of encouraging investors to invest in entity enterprises, especially technological innovation enterprises, in order to alleviate the difficulty of enterprise in financing to a certain extent, but also implement the principles of capital maintenance and protecting the legitimate rights and interests of creditors, and balance the interests of investors, company creditors, and the company in accordance with the law. For the VAM agreement concluded between the investor and the shareholders or actual controllers of the target company, if there are no other reasons for invalidity, it shall be deemed valid and supported for actual performance, and there is no dispute in practice. However, there is controversy over the validity and actual performance of the VAM agreement between the investor and the target company.”We need to consider both equity buybacks and monetary compensation.
Jotai Research Institute
Jotai Consultation Assistant