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China’s Belt and Road Initiative (BRI) is having a transformative effect on infrastructure development and international trade. This strategic development reflects China’s rapid emergence as a dominant player in the new international economic order and its competition with other major powers. It also reflects China’s championing of globalization. The BRI program will inevitably affect the emerging body of international commercial law operating in the over 125 countries and 29 international organizations that have signed up to be part of the BRI. Although there are many legal issues that have been raised by these developments, this article examines the emerging shape of cross-border insolvency law on the maritime and overland ‘Silk Roads’. Solvency problems are already emerging as serious concerns arising out of debts incurred through China’s infrastructure investments under this initiative. To-date, only 24 BRI countries have to varying degrees implemented the United Nations Commission on International Trade Law (UNCITRAL) Model Law on Cross-Border Insolvency, creating a tension between territorial and more universalist approaches. In the short term, these insolvency issues are likely to be dealt with in a number of ways, such as by resorting to ‘soft law’ or by using administrative or political mechanisms. Given China’s commitment to the rule of law (with Chinese characteristics), it is inevitable that efforts will be made to give some normative shape to this new global space. This article seeks to explore this emerging frontier for cross-border insolvency law Refereed/Peer-reviewed

The regulation and control of bribery and corrupt practices by globally active corporations has become a matter of increasing concern in recent years. For many years the US Foreign Corrupt Practices Act (1977) has stood as a model for other countries. Other countries have been slow to introduce improved anti-bribery laws and have often only been prompted to review their laws and practices in this area as a result of major corporate scandals. The passage of the UK Bribery Act (2010) has now provided a more broad-ranging model that has built upon prior experiences, such as in the USA, as well as upon advances in regulatory theory. Multilateral efforts, such as by the G20, have also become more important in encouraging countries to enhance global anti-bribery mechanisms. This paper critically examines this national and multilateral regulatory experience and discusses difficulties that individual states, such as Australia, have had in responding to the need for more effective anti-bribery laws and enforcement mechanisms. Refereed/Peer-reviewed

Australia has always relied heavily upon foreign sources of investment and financing and has in the past tended to draw mainly upon British, American and Japanese investment. In recent decades, Chinese state-owned enterprises (SOEs) have played an increasingly important role in the Australian economy with a rising level of investment taking place. Chinese SOEs have been more heavily involved in investments into larger Australian investment projects, such as in mining and infrastructure. Australia has seen an increase in the number of Chinese state-owned companies acquiring substantial domestic assets; this may continue following the ratification of the China-Australia Free Trade Agreement in 2015. Although Chinese SOEs operating in foreign countries such as Australia are required to comply with local corporate governance laws and principles, they also retain their unique Chinese corporate governance values and culture which they have inherited through their parent companies and from China itself. In Australia, there has been an ongoing debate over Chinese investment, with the business community being particularly supportive of such investment. Driven largely by the business community, this debate has been relatively narrow and has not explored the likely impact of Chinese SOEs and their subsidiaries upon the shape of corporate governance in countries in which they invest. This article seeks to examine the legal contours of Chinese-controlled investment in Australia with a view to acquiring a more informed understanding of the impact of Chinese SOEs upon the Australian legal landscape.

In the recent international history of insolvency law reform, the reform of corporate rescue and restructuring has been an ongoing project. In China, the enactment of the Enterprise Bankruptcy Law 2006 saw the introduction of a bankruptcy reorganisation procedure that incorporates the debtor-in-possession model found in Chapter 11 of the US Bankruptcy Code. However, the Chinese corporate rescue procedure has been significantly underused due in part to various drawbacks associated with this court-based and highly politicalised process. This paper explores the possibility of reforming China's current corporate rescue regime by drawing upon the Australian voluntary administration procedure. Found in Part 5.3A of the Corporations Act 2001 (Cth), this procedure was designed to provide a relatively swift, inexpensive and flexible corporate rescue mechanism for companies in financial distress. It comprises a noncourt based mechanism under the control of one or more professionally qualified private administrators. It is interesting to note that the UK also moved away from exclusive reliance upon court-based administration procedures following the passage of the Enterprise Act 2002. This moved the UK closer to the Australian practitioner-dominated approach to corporate rescue. This paper argues that the addition of a voluntary administration-style procedure to China's current corporate rescue regime may be needed as China develops its market economy based on the rule of law. Copyright © 2017 INSOL International and John Wiley & Sons, Ltd

The current model of corporate governance needs reform. There is mounting evidence that the practices of shareholder primacy drive company directors and executives to adopt the same short time horizon as financial markets. Pressure to meet the demands of the financial markets drives stock buybacks, excessive dividends and a failure to invest in productive capabilities. The result is a ‘tragedy of the horizon’, with corporations and their shareholders failing to consider environmental, social or even their own, long-term, economic sustainability. With less than a decade left to address the threat of climate change, and with consensus emerging that businesses need to be held accountable for their contribution, it is time to act and reform corporate governance in the EU. The statement puts forward specific recommendations to clarify the obligations of company boards and directors and make corporate governance practice significantly more sustainable and focused on the long term.

Recent financial market failures and corporate collapses have led to a loss of faith in many traditional legal regulatory tools used to control financial markets. The failure to successfully pursue criminal actions against senior officers in banks and financial institutions following the global financial crisis has raised questions regarding the utility of criminal prosecutions. A number of explanations for the declining use of criminal prosecutions and the use of other remedies, such as commercial settlements, have been given; this has often shifted the regulatory burden to shareholders and the community from company officers. This failure has led to a significant loss of trust in banking and financial institutions. Over the last decade, we have seen a renewed interest in the idea of corporate culture as a regulatory tool. Many financial regulatory authorities have sought to draw upon this idea in the regulation of financial institutions, although the fuzziness of the concept of culture has made it difficult to use as a prosecutorial tool. Despite some strident efforts to develop a legal model of corporate culture, it has yet to be applied widely and not at all to the financial services industry. It is unlikely to provide the “quick fix” that some market regulators had hoped for.

China has enacted a number of company law statutes since the early 1990s. These demonstrate a commitment to the adoption of the corporate form as a vehicle for business activity. In the 1993 and 2005 Company Laws, and in numerous amendments to these laws, Chinese legislators have shown that they have been well attuned to modern corporate law ideas and concepts. Nevertheless, these company laws reflect some important Chinese characteristics, such as the dominant role of the Communist Party and of the impact of the state in Chinese companies. Chinese company law has clearly evolved in the shadow of a strong authoritarian state. This has influenced the ways in which these laws have been implemented. This article explores key issues regarding the implementation of company law in China since 1993 and suggests that the language of the law cannot be understood without an appreciation of various institutional constraints upon the effect of company law upon Chinese companies. Refereed/Peer-reviewed

Many countries have benefited greatly from an influx of investment from China; much of this investment has come from Chinese State-owned enterprises (SOEs). Functioning as China’s national champions, Chinese SOEs have been the vehicles for the Chinese government to obtain resources from the international market, to participate in international market competition, and to expand Chinese national soft power. They also allow Chinese SOEs to gain controlling interests in foreign companies; this opens doors for other Chinese enterprises to sell goods and services abroad; this is a pattern that is well established from prior eras of foreign investment in countries such as Australia. However, these SOEs are also facing challenges overseas, especially the SOEs investing in the natural resources sector overseas. In order to meet the challenges of modern corporate governance, Chinese SOEs have sought to enhance their corporate governance practices whilst the Chinese government has also sought to reform its inefficient SOEs. In response to the challenges facing modern globally-active companies, China has adopted corporate social responsibility (CSR) ideas to better regulate its enterprises. This has often been supported by legislative mechanisms. With increasing outward-bound investment by Chinese SOEs, many SOEs have also developed their own CSR codes. This chapter explores some CSR norms developed by Chinese government agencies and China’s SOEs and examines how Chinese SOEs have implemented CSR norms to protect non-economic interests in natural resources rich countries, such as Australia.

China's phenomenal economic growth in the past 30 years has witnessed the rise of its global natural resources companies. At the same time, the emerging of a middle class in China and their desire to improve living standards including better dwelling conditions, better health and nutrition, has driven strong demand in mineral resources, energy and quality food. The so called 'socialist market economy' in China has seen this growing demand being met partially by companies with 'national significance'. In the resources sector, these companies are represented by companies listed in stock exchanges in China as well as globally such as in New York and London; at the same time, most of these companies are also controlled by the Chinese government. China's resources companies have expanded overseas in search of new acquisition targets whilst seeking to extend their global reach with a focus on resource rich countries. The expansion of these companies internationally, and the unique ownership structure of these companies, has posed challenges for regulators, trading partners of these companies, investors and other interested parties seeking to understand how these companies are governed and the implications of government ownership for resource security globally. Resource Security and Governance: The Globalisation of China's Natural Resources Companies contains case studies of the global expansion efforts of Chinese global natural resources companies; it reviews the governance structures of these companies and analyses how these have affected the inter-relationship between these companies and their trading partners, governments, regulators in targeted countries and investors globally. In addition, this book examines how the unique structure of these companies may affect resource security globally and touches on other related matters such as climate change, and air and water security in China.

This article discusses the extent to which rule of law principles have been embraced within the language, principles and practice of China’s Company Law. The paper discusses different understandings of the rule of law that are to be found in the wider literature. Whilst China has affirmed the principles of legality, the 1993 Company Law adopted a narrowly prescriptive approach; at the same time, the State took firm control of the degree to which the privileges of limited liability and incorporation will be available. As a result, the balance of power within the company has tended to favour the State rather than the company or its shareholders. In contrast to the broadly non-interventionist approach to the internal affairs of companies of the courts and the State in western countries, in China the State and the Party have played an important role in internal company decision making, such as through the appointment of the company Chairman and the role of the Party Secretary. Whilst acknowledging the limits of the rule of law in Western countries, the article goes on to discuss various challenges to the implementation of the rule of law in China’s business relations. The article discusses how China’s company laws have in practice been applied; particular attention is given to the handling of the case involving Australian businessman James Peng which was seen at the time by some as a litmus test for the operation of the rule of law in China. Peng had reorganised a former state owned company and generated substantial profits as a result of his efforts to use legal rules to his advantage. Later, Peng had a falling out with his Shenzhen business partners who launched a vendetta against him; he was abducted from his hotel in Macao and taken secretly to Shenzhen where he was incarcerated. The involvement of a 'princeling' or a relative of a senior Chinese political official in Peng’s business affairs complicated the matter. Although embezzlement charges against Peng had been thrown out by the local Shenzhen courts, due to a lack of evidence, the central government seemed powerless to prevent local cadres from continuing their vendetta so that the rule of law in this case was severely tested. The paper documents these issues and draws some broader conclusions about the limits of company law ideas in China.

Recent financial and corporate crises have led to a loss of faith in many traditional legal regulatory tools used in regard to the control of financial markets. The failure to successfully pursue criminal actions against senior officers in banks and financial institutions following the global financial crisis (GFC) has raised questions regarding the utility of criminal prosecutions in this area. This has caused a significant loss of trust in banking and financial institutions. One response to these problems has been a renewed interest in the idea of corporate culture and its value as a regulatory tool. This has drawn upon earlier models developed by socio-legal scholars and lawyers. Regulatory authorities have been keen to use the idea of culture in the regulation of financial institutions, although the fuzziness of the concept has made it a difficulty tool to use as a legal mechanism, such as in criminal prosecutions. Although conceptually appealing, for a variety of reasons discussed here, corporate culture is unlikely to be the “quick fix” that many hope for, so as to re-establish public confidence and trust in financial markets.

Australia has always relied heavily upon foreign sources of investment and financing and has in the past tended to draw mainly upon British, American and Japanese investment. In recent decades, Chinese state-owned enterprises (SOEs) have played an increasingly important role in the Australian economy with a rising level of investment taking place. Chinese SOEs have been more heavily involved in investments into larger Australian investment projects, such as in mining and infrastructure. Australia has seen an increase in the number Chinese state-controlled companies acquiring substantial domestic assets; this may continue following the ratification of the China-Australia Free Trade Agreement in 2015. Although Chinese SOEs operating in foreign countries such as Australia are required to comply with local corporate governance laws and principles, they also retain their unique Chinese corporate governance values and culture which they have inherited through their parent companies and from China itself. In Australia, there has been an ongoing debate over Chinese investment, with the business community being particularly supportive of such investment. Driven largely by the business community, this debate has been relatively narrow and has not explored the likely impact of Chinese SOEs and their subsidiaries upon the shape of corporate governance in countries in which they invest. This article seeks to examine the legal contours of Chinese-controlled investment in Australia with a view to acquiring a more informed understanding of the impact of Chinese SOEs upon the Australian legal landscape.

In the recent international history of insolvency law reform, the reform of corporate rescue and restructuring has been an on-going project. In China, the enactment of the 2006 Enterprise Bankruptcy Law saw the introduction of a bankruptcy reorganization procedure that incorporates the debtor-in-possession model found in Chapter 11 of the US Bankruptcy Code. However, the Chinese corporate rescue procedure has been significantly underused due in part to various drawbacks associated with this court-based and highly politicized process. This paper explores the possibility of reforming China’s current corporate rescue regime by drawing upon the Australian voluntary administration (VA) procedure. Found in Part 5.3A of the Corporations Act 2001(CTH), this latter procedure was designed to provide a relatively swift, inexpensive and flexible corporate rescue mechanism for companies in financial distress. It comprises a non-court based mechanism under the control of one or more professionally qualified private administrators. It is interesting to note that the UK also moved away from exclusive reliance upon court-based administration procedures following the passage of the Enterprise Act 2002. This moved the UK closer to the Australian practitioner-dominated approach to corporate rescue. This paper argues that the addition of VA-style procedure to China’s current corporate rescue regime may be needed as China develops its market economy based on the rule of law.

In the wake of the Global Financial Crisis (GFC), banks in the UK and other parts of the world suffered significant financial losses. One of the findings of official inquiries into the GFC and its effects in the UK is that shareholders were remarkably docile during the height of the market euphoria. Shareholders made very little effort to constrain banks from taking more risky business strategies. In addition, shareholders have been slow to bring legal actions against directors of loss-making banks and financial institutions. This is despite the fact that company law provides a wide range of mechanisms for shareholder activism, such as the powers of shareholders to elect and dismiss directors, (through the General Meeting), and to bring legal actions against directors for breach of statutory and fiduciary duties. This suggests that company law is, in practice, something rather different from what it is claimed to be in theory. This chapter explores some of the reasons for this divergence and looks at ways of bridging this gap between company law in theory and in practice. In so doing it examines the use of human rights claims as a last resort where the more traditional company law principles have proved to be inadequate with regards to fostering shareholder activism.

China’s insolvency regime has been in a state of transition for a relatively long period of time, although a new Bankruptcy Law was finally to be passed in 2005. The draft of the Bankruptcy Law of the People’s Republic of China (herein after referred to as “Draft Bankruptcy Law”, went to the 10th session of Standing Committee of the National People’s Congress (NPC), China’s top legislative body, for deliberation on 21st June 2004. The Draft Bankruptcy Law was submitted to the meeting of the National People’s Congress in March 2005. It is useful to seek to understand the background against which this new law has emerged. Until the new Bankruptcy Law comes into effect, bankruptcy was governed by a variety of legal instruments and procedures discussed in this paper. It is likely that the pre-existing approaches to dealing with insolvency in China will also have some continuing effect after the enactment of the new PRC Bankruptcy Law. This earlier history of bankruptcy laws in China is therefore of interest.

China’s ‘Go Global’ strategy has encouraged Chinese companies to seek to enhance China’s resource security through acquisitions in foreign markets. Under the influence of this policy, Chinese companies have increased greatly outbound investment in recent years, and one consequence of this increased activity has been the generation of a range of commercial disputes. The choice of different methods of dispute settlement is in part influenced by the national legal cultures that have shaped the mindsets of parties to these commercial disputes. Recent Chinese investment abroad has grown significantly and increasing economic engagement between China and other countries will inevitably involve some degree of conflict as different legal cultures interact. In understanding points of tension in the Sino–Australian investment relationship questions are raised concerning legal pluralism and the impact of legal culture on Chinese-controlled companies operating in Australia. This article discusses a number of recent commercial disputes involving Chinese companies in Australia and the slow movement that these cases reveal towards a more globalized commercial law. Refereed/Peer-reviewed

In 2006, China enacted its first rescue-orientedEnterprise Bankruptcy Lawwith the aim of establishing its corporate rescue culture. But the corporate reorganization procedure that is at the heart of the new bankruptcy law has not been used frequently. It is appropriate to ask why the use of China’s new corporate rescue law has been so low. Meanwhile, in the existing corporate reorganizations under the 2006Law, most debtors were excluded from the reorganization process, so that the Chinese new debtor-in-possession model, which seems to be a desirable control format, was largely shelved. Why so? This article explores these two issues through the use of empirical data collected from Zhejiang, a province with a significantly larger number of reorganizations than most other Chinese provinces.

Corporations play a central role in modern economies. Certain beliefs about corporations and corporate law are widely held and relied upon by business experts, the financial press, and economists who study the firm. Unfortunately, some of these widely-held beliefs are mistaken. This has led to numerous common errors in the way corporate law concepts are understood and applied. The authors of this Summary are experts versed in a variety of national legal systems, including those of the U.S. and U.K. as well as the E.U. We provide this simple Summary of certain fundamentals of corporate law, applicable in almost all jurisdictions, in an effort to help prevent analytical errors which can have severe and damaging effects on corporations and corporate governance.

The enactment of China's Enterprise Bankruptcy Law in 2006 after debates spanning two decades was a milestone in the development of China's market-based economy. Bankruptcy laws have served as a key mechanism for market economies to adhere to their stated goals. One way of softening the harsh effects of insolvency is to develop a system of corporate reorganisation or rescue; China has also sought to move in this direction through its bankruptcy law reforms. However, the implementation of these laws has revived many of the older debates that undermined the law reform process. Paradoxically, although the Chinese economy has slowed considerably with the continued global financial crisis, there has been a very limited use of company reorganisation procedures and insolvency administrators in China. This demonstrates the limits to which external legal models will be effective in China and the complexity of the problems that remain to be resolved. Refereed/Peer-reviewed

In recent years, China’s ‘Go Global’ policy has encouraged Chinese companies to go abroad to invest; inevitably this increased investment activity has generated a range of tensions and commercial disputes. The legal cultures that have shaped the mind-sets of parties to these commercial disputes will affect the choice of different dispute resolution methods. Recent Chinese investment in Australia has also grown significantly in areas such as mining, agriculture and real estate; as a result of cultural differences, the economic engagement between Australia and China will inevitably involve some degree of negotiation, disagreement and conflict. This leads us to examine the impact that legal culture has on dispute resolution practices found in Chinese companies operating in Australia. This exploratory analysis draws upon theories of globalization and legal culture and discusses Chinese legal culture and its impact on commercial disputes involving Chinese companies operating in Australia.

The maintenance of capital doctrine has generated considerable debate in corporate law since its heyday in the late nineteenth century. Capital rules continue to be debated in jurisdictions as diverse as the China and the United Kingdom. It was long assumed that the doctrine protected a company’s creditors and ensured that directors applied the equity capital of the company properly. The success of this doctrine in achieving these protective goals has been questioned. As a consequence, corporate law rules regarding capital related decisions have progressively been reformed. One strategy relied upon by reformers is to link corporate capital decisions to various tests relating to solvency, fairness and material disclosure to shareholders. Australian lawmakers have moved away from the old prohibitive approaches to corporate capital changes by drawing upon such tests and mechanisms. The Corporations Act 2001 (Cth) adopts this more permissive approach requiring that solvency, fairness and disclosure issues be satisfied by directors before capital related decisions are made. These decisions include the payment of dividends, share capital reductions, share buy-backs, and the provision of financial assistance to purchase shares. These decisions are now made subject to the insolvent trading provisions found in s 588G of the Corporations Act. Thus, directors of companies making such decisions will be personally liable if they make such a decision in breach a duty imposed upon them to prevent the company from trading whilst insolvent where they have reasonable grounds for suspecting that the company was insolvent at the time that the capital related decision was made or would become insolvent as a result of the decision. This more liberal approach has been adopted in a number of other jurisdictions.

Corporate governance reform challenges Chinese firms trying to establish themselves in global markets.When they enter foreign markets, Chinese enterprises are likely to bring their pre-existing corporate governance practices with them. This article examines how the corporate governance practices of foreign-listed corporations operating in China have been received and how major Chinese companies operating outside China have responded to corporate governance requirements of foreign countries when listing abroad. The pervasive role of the State within individual Chinese companies is fundamental to understanding China’s corporate governance practices both at home and abroad. Since the State in China is somewhat fragmented (its various agents operating at the national, provincial, and local levels), large company shares may be held by different state agencies and may be used in different ways. This can result in conflicting obligations to the State. Although China may have copied Western corporate laws, stock market rules, and corporate governance codes, the local meaning of these transplants is inevitably different due to the dominance of the state in large listed companies both as a shareholder and as the regulator. The ‘Go Global’ campaign of senior Chinese officials might have been expected to consolidate the transposition of corporate governance practice and to have hastened some convergence between Chinese and Anglo-American corporate governance practice. However, this does not seem to have happened as expected. The listing of Chinese companies on foreign stock exchanges does not seem to have resulted in these companies embedding foreign principles of corporate governance. Refereed/Peer-reviewed

Examines different approaches to the challenge of Australian corporate law enforcement and governance, and discusses success in this area and how it might be determined. Describes barriers to measuring success of regulatory action, and debates what level of law enforcement is appropriate and cost‐effective. Concludes that a more broadly based approach to regulatory action and assessment is of prime importance.

Corporate governance reform is a major challenge facing Chinese firms trying to establish themselves in global markets. When they enter foreign markets, Chinese enterprises are likely to bring their pre-existing corporate governance practices with them. This paper examines how the corporate governance practices of foreign listed corporations operating in China have been received and how major Chinese companies operating outside China have responded to corporate governance requirements of foreign countries when listing abroad. The pervasive role of the state within individual Chinese companies is fundamental to understanding China’s corporate governance practices both at home and abroad. Because the state in China is somewhat fragmented, (its various agents operating at the national, provincial and local levels), large company shares may be held by different state agencies and may be used in different ways. This can result in conflicting obligations to the State. Although China may have copied Western corporate laws, stock market rules and corporate governance codes, the local meaning of these transplants is inevitably different due to the dominance of the state in large listed companies both as a shareholder and as the regulator. The “Go Global” campaign of senior Chinese officials might have been expected to consolidate the transposition of corporate governance practice and hastened some convergence between Chinese an Anglo American corporate governance practice. However, this does not seem to have happened as expected. So, the listing of Chinese companies on foreign stock exchanges does not seem to have resulted in these companies absorbing more refined principles of Anglo-American corporate law and governance.

The rise of the information age has led to what some have referred to as the network society. The rise to prominence of the network society is likely to change the nature of corporate organisation and activity. It is also likely to have huge implications for how we think of corporations- ideas that the corporation is a ‘nexus of contracts’ or a means of reducing ‘transaction costs’ will no longer accurately describe the true nature of the modern ‘network enterprise’ which the corporation has become. Arguably, the idea of trust can be more closely associated with this new form of network enterprise. It is also likely that many of the previously dominant ideas in corporate governance, such as agency theory and shareholder primacy, will no longer be adequate for articulating how best to govern the modern network enterprise. This is largely because they conflict with a wider trust-oriented approach. Such an approach facilitates greater stakeholder engagement in corporate governance. This article suggests that, going forward, trust and embedded stakeholder ideas will play a greater role in the organisation and governance of corporations.

The Global Financial Crisis (GFC) threatened to bring world financial markets to a halt. It is now coming to light that in the run-up to, and at the height of, the GFC, investment banks and other participants in the financial markets acted unethically as well as imprudently. This article takes a closer look at this unethical behaviour and the way in which it constitutes a failure of trust. The article defines trust and outlines why it is important in the regulation of financial markets. It then looks at three examples of breakdowns or failures of trust in the run-up to the financial crisis. The article concludes by arguing that trust is important in commercial relationships at both the intra-firm level (the relations between the different constituents of the firm) and the inter-firm level (the relations between the firm and other firms).