Four Ministries to Provide Guidelines for Handling Cross-Border Pursuit and Litigation by the Parties in Interest Against Abnormal Withdrawal of Foreign Investment
On November 19, 2008, the Ministry of Commerce, the Ministry of Foreign Affairs, the Ministry of Public Security and the Ministry of Justice jointly released the Circular on Working Guidelines for Cross-Border Pursuit and Litigation by the Parties in Interest Against Abnormal Withdrawal of Foreign Investment (the "Circular"). The Circular advises the party in interest to file a claim with the court or police department immediately after the occurrence of an abnormal withdrawal of foreign investment by the foreign parties and to initiate a civil or criminal case against the foreign parties allegedly responsible. The party in interest may apply for international judicial assistance from relevant countries pursuant to relevant treaties in, among others, service of process, collection of evidence, assisting with the investigation of the whereabouts of the concerning parties and the money, search and seizure of certain goods and articles, and carrying out the legal proceeding and enforcement of judgments. The Circular also provides that the foreign enterprises or individuals who are shareholders of limited liability companies, or controlling shareholders, directors or actual persons who control companies limited by shares, shall be jointly and severally liable for such companies' debt if failure to perform normal liquidation obligations causes losses to the creditors.
Copyright ©2009 by Kaye Scholer LLP. All Rights Reserved. This publication is intended as a general guide only. It does not contain a general legal analysis or constitute an opinion of Kaye Scholer LLP or any member of the firm on the legal issues described. It is recommended that readers not rely on this general guide but that professional advice be sought in connection with individual matters. References herein to "Kaye Scholer LLP & Affiliates," "Kaye Scholer," "Kaye Scholer LLP," "the firm" and terms of similar import refer to Kaye Scholer LLP and its affiliates operating in various jurisdictions.
