advanced Unit 7

Creditor File for Affiliated Companies

Veil Piercing, Groups, and Creditors

Facts

A creditor contracted with East Bridge Trading Co. The purchase orders use East Bridge’s seal, but sales calls came from West Bridge Machinery staff. Payments moved through a third affiliate, and all three companies share one office and one finance manager.

Questions

  1. Which facts support separate personality?
  2. Which facts support confusion of personality or abuse of limited liability?
  3. What additional evidence should a creditor seek?

Hints

Look for assets, accounts, personnel, contracts, seals, public registration, websites, invoices, and actual performance.

Discussion Guide

Students should build an evidence matrix rather than jump straight to veil piercing. Strong answers distinguish normal group coordination from legally significant confusion.

Exercise sources

Linked resources

law Mainland China English version

Company Law of the People's Republic of China (2023 Revision)

中华人民共和国公司法

The core statute for Chinese companies, covering legal personality, registration, capital, corporate organs, directors' duties, state-invested companies, bonds, accounting, restructuring, dissolution, liquidation, and liability.

Authority
National People's Congress
Citation
Revised 29 December 2023; effective 1 July 2024
Date
2024-07-01
case Mainland China Translation unavailable

Guiding Case No. 15: Xugong Group v. Chengdu Chuanjiao and Others

指导案例15号:徐工集团工程机械股份有限公司诉成都川交工贸有限责任公司等买卖合同纠纷案

A corporate personality and creditor-protection case involving affiliated companies, commingled business, overlapping personnel, and confusion of assets.

Authority
Supreme People's Court
Citation
Supreme People's Court Guiding Case No. 15
Date
2013-01-31
case Mainland China Translation unavailable

Guiding Case No. 9: Shanghai Cunliang Trading Co. v. Jiang Zhidong and Others

指导案例9号:上海存亮贸易有限公司诉蒋志东、王卫明等买卖合同纠纷案

A leading case on shareholders' liquidation obligations and creditor protection after a company is deregulated or loses its business license.

Authority
Supreme People's Court
Citation
Supreme People's Court Guiding Case No. 9
Date
2012-09-18
case United Kingdom English original

Salomon v. A Salomon & Co Ltd

The classic common-law authority for separate corporate personality and limited liability.

Authority
House of Lords
Citation
[1897] AC 22
Date
1896-11-16