Business Law in China

This course will study and analyze business and investment law in the People’s Republic of China (PRC), focusing on selected topics in commercial law generally, the law of corporate and unincorporated entities, securities law, the regulation of banks and non-bank financial institutions, corporate finance and M&A, and the law and regulation governing the PRC domestic capital markets and publicly listed companies accessing capital on both those domestic markets and global exchanges. In addition, the course will dedicate some time to understanding the still-separate legal and regulatory regime governing foreign investment generally, both direct (private) foreign investment, and foreign portfolio investment in PRC-domiciled firms raising capital on the Chinese and global public markets, and the impact of established and under-negotiation Bilateral Investment Treaties (BITs) between foreign nations and the PRC. The course will focus on specific aspects of the “public” (listed) Chinese corporation, and the direct impact of the domestic and global capital markets – and transnational or “foreign” securities regulation/corporate governance norms – on corporate governance in China, the crafting of formal law and regulation, and application of the law via both public and private enforcement. The course will address the ever-increasing interaction between PRC firms and asset groupings with external (foreign) – including U.S. -- legal and regulatory systems and radically different political economies. These topics will be considered in the context of the PRC’s thoroughgoing economic system transition over the past 40 years, from a state-owned, centrally-planned, economy to something more closely resembling a capitalist market economy albeit with heavy state involvement, and the establishment post-1978 of an increasingly developed system of substantive law and regulation and complementary legal institutions. Throughout, students will be exposed to the unique aspects of China’s political economy and business environment through intensive analysis of contemporary case studies. Students would appreciate the complexity of the transition in the People’s Republic of China (PRC) after 1978 from state-owned enterprises into 'corporatized' state-controlled (but publicly-invested) firms, and the parallel effect of the PRC’s initial foreign direct investment structures and law on the later formation of China’s company law.

In each case, participants will become familiar with these diverse developments and mechanisms so as to inform the broadest possible understanding of the modern corporation – and corporate law – as well as financial law and investment law in the PRC today. Throughout, participants will be asked to consider the unique role of formal (business association) law and (financial and investment) regulation in the Chinese context, its interaction with divergent and often more powerful political economic structures, the relationship between corporate law and enterprise efficiency and national economic growth, the ever-changing balance between government control/regulation and autonomy of capital accumulating entities, and the impact of corporate law and corporate governance principles on the development of civil society and 'rule of law' in the Chinese world.

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