China's enterprise bankruptcy law, building an infrastructure towards a market-based approach.

China has long been under external pressure to develop a market-based approach to bankruptcies and reduce state involvement in such cases. The enactment of the Enterprise Bankruptcy Law 2006 was an important first step in this regard but laws are insufficient in themselves to bring about such an approach and this Act has given rise to a very low number of cases, attributed in part to ongoing state influence. This article examines the reasons for the law's limited impact, paying particular attention to the role of the state, which appears to be changing. [ABSTRACT FROM AUTHOR]