Government-in-Possession in Chinese Corporate Reorganizations
Control in corporate reorganization is of significance for the achievability of a rescue effort, since the party allowed to stay at the helm of a rescue procedure must be both competent and well incentivised. Inspired by debtor-in-possession used in American corporate reorganizations and practitioner-in-possession practised in English administrations, China adopts both approaches, setting up, under the newly enacted Enterprise Bankruptcy Law of 2006, practitioner-in-possession as a default control model in corporate reorganizations and debtor-in-possession as an alternative. But this essay finds that it is largely local government staying in control of corporate reorganizations, whether an insolvency practitioner is appointed as the reorganization administrator or not. Essentially, government-in-possession is the de facto control model in Chinese corporate reorganizations. This essay uses empirical data to prove this conclusion.
About the Speaker
Dr Zinian Zhang is a Lecturer in Commercial Law at the Centre for Business Law and Practice whose research focuses on corporate insolvency law, especially the corporate reorganisation law in three jurisdictions, China, UK and USA. He uses empirical methods to explore the world of corporate reorganisations. Having studied at Durham University Dr Zhang was a research fellow at Singapore Management University before joining Leeds in 2015. He practised law in Hangzhou, Zhejiang, China, holding a senior partner position in a law firm prior to entering into academia. Dr Zhang teaches in Corporate Insolvency Law, Company Law, and Corporate Governance.
University of Leeds