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Law of the People's Republic of China on 

Partnership Enterprises

(Adopted and promulgated at the 24th Meeting of the Standing Committee of the Eighth National

People's Congress on February 23, 1997 )

Chapter I General Provisions

Article 1

    This Law is formulated with a view of standardizing partnership enterprises' activities,

protecting the legitimate rights and interests of partnership enterprises and their partners,

maintaining the social and economic order, and promoting the development of the socialist

market economy.

Article 2

    "Partnership enterprise" mentioned in this Law refers to a profit-making organization

established within the territory of China according to this Law with their partners associated

under a partnership agreement, each making capital contributions, carrying out business

operations, distributing profits, undertaking risks and bearing unlimited and joint liability for

the partnership enterprise's debts.

Article 3

    A partnership agreement shall be in written form after consultation and agreement among all

the partners according to law.

Article 4

    In concluding a partnership agreement and establishing a partnership enterprise, the parties

shall follow the principles of voluntariness, equality, fairness, honesty and credibility.

Article 5

    Partnership enterprises shall not use words such as "limited" or "limited liability" in their

names.

Article 6

    In engaging in business activities, partnership enterprises must observe laws and

administrative regulations and abide by professional ethics.

Article 7

    Property, legitimate rights and interests of partnership enterprises and their partners shall

be protected by law.

Chapter II Establishment of Partnership Enterprises

Article 8

    The following conditions shall be fulfilled for the establishment of a partnership

enterprise:

   (1)    two or more partners each of which to bear unlimited liability according to law;

   (2)    a written partnership agreement;

   (3)    capital contributions actually made by each of partners;

   (4)    the name of the partnership enterprise; and

   (5)    the place of business and conditions necessary for partnership operations.

Article 9

    A partner shall be a person with full capacity for civil conduct.

Article 10

    Those prohibited by laws or administrative regulations from engaging in profit-making

activities shall not be partners of a partnership enterprise.

Article 11

    A partner may make his capital contributions in currency, or by providing material objects,

land use rights, intellectual property rights or other property rights. The capital contributions

above-mentioned shall be legal property or property rights owned by the partner.

  Capital contributions in other forms than in currency may, if necessary, be appraised and

evaluated by all the partners through consultation, or by a statutory evaluation institution with

the authorization of all the partners.

  A partner may provide personal services as capital contributions after consultation and

agreement among all the partners. The evaluation of contributions in the form of services shall

be determined by all the partners through consultation.

Article 12

    Partners shall perform their duties of capital contribution in terms of the form, amount and

time limit of such contribution, as agreed upon among them in the partnership agreement.

  Capital contributions actually made by each of the partners according to the partnership

agreement shall be regarded as contributing to the partnership enterprise.

chinese Version