China company directors are assumed to be directly involved in the day to day business operations of the company. It is very rare in China to have directors who do no more than attend an occasional board meeting and merely review high level documents and policy decisions.
Basic Requirements on Director
In general, a natural person over 18 years old can become a director. The person is not required to be resident in China and there is no nationality requirement. However, he/she shall not be convicted of corruption, bribery, conversion of property, or disruption of social order within the last five years, or be stripped of political rights for being convicted of a crime within the last five years.
Number of Directors
For a limited liability company, a board of directors must have three to 13 members. Companies operating on a small scale or with few shareholders can have one executive director instead of establishing a board of directors. However, for Sino-foreign joint ventures in the form of a limited liability company, the board of directors must comprise no less than three members.
For a company limited by shares, the members of the board of directors must have five to 19 members. A limited liability company or a company limited by shares must have a supervisory board, which comprises no less than three members. However, a limited liability company operating on a small scale or with few shareholders can have one to two supervisors instead of establishing a supervisory board.
Appointment and Removal of Director
Generally, the members of the board of directors are appointed by the shareholders' meeting. For Sino-foreign joint ventures, each shareholder can appoint its directors to the board of directors.
The members of the board of directors are removed by the shareholders. For Sino-foreign joint ventures, each shareholder can remove its directors from the board of directors.
Duties and Liabilities of Director
Directors must comply with the provisions of law and administrative regulations, and the articles of association of the company, and bear fiduciary duties towards the company.
However, directors must not abuse their duties and rights, receive bribes or other illegal income, or embezzle company assets. A director who violates the provisions of law and administrative regulations or the articles of association of the company in his/her performance of powers and functions, causing the company to suffer damages is liable to pay compensation.
Contact Us
If you have further inquires, please do not hesitate to contact Tannet at anytime, anywhere by simply visiting Tannet’s website english.tannet-group.com, or calling Hong Kong hotline at 852-27826888 or China hotline at 86-755-82143422, or emailing to tannet-solution@hotmail.com. You are also welcome to visit our office situated in 16/F, Taiyangdao Bldg 2020,Dongmen Rd South, Luohu , Shenzhen, China.
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