The Wall Street Journal Online, October 17, 2006, has an interesting article on China's new bankruptcy law titled, Beijing's Bankruptcy Law.
Enacted in August by China's legislature, the National People's Congress, it comes into force next June 1. A formal corporate-bankruptcy procedure will be created, with administrators appointed by judges, not the government, as was the case under the old law. Creditors go to the front of the queue for payment, ahead of employees. Creditor committees get a strong role in supervising the bankruptcy process, which means that professionals -- perhaps including foreign lawyers and accountants -- will be running the process, rather than Communist Party officials.
Read the entire article here.
Read an account of the new bankruptcy law from China View here.
Posted by Jon Lutz
