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Article on obligations & liabilities of directors, supervisors and senior officers under the new PRC company law. By丨 Ron Cai,Jay Si,Sean Lao, Julie Yang On December 29, 2023, the Standing Committee of the National People’s Congress passed the Company Law of the People’s Republic of China (2023 Revision) (the “ New Company Law” ), which came into effect on July 1, 2024. The New Company Law has further clarified and strengthened the obligations and liabilities of directors, supervisors, and senior officers [1] (each a “ DSO ”). I.Duty of Loyalty The previous Company Law of the People’s Republic of China (2018 Revision) (the “ 2018 Company Law ”) only stipulates in broad principle that DSOs have duties of loyalty and diligence to the company, without further exploring what these duties are. The New Company Law fills this gap. The New Company Law specifies that duty of loyalty means that DSOs must take measures to avoid conflicts between their personal interest
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