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	REPLY OF THE STATE ADMINISTRATION FOR INDUSTRY AND COMMERCE REGARDING WHETHER THE LEGAL REPRESENTATIVE OF AN ENTERPRISE SHALL BEAR INDIVIDUAL LIABILITY

	(No. 123 [2002] of the State Administration for Industry and Commerce promulgated June 7, 2002)


SUBJECT : ENTERPRISE'S LEGAL REPRESENTATIVE; INDIVIDUAL LIABILITY
ISSUING DEPARTMENT : STATE ADMINISTRATION FOR INDUSTRY AND COMMERCE OF THE PEOPLE'S REPUBLIC OF CHINA
ISSUE DATE : 06/07/2002
IMPLEMENT DATE : 06/07/2002
LENGTH : 410 words
TEXT :

Regarding Request for Instruction on the Issue of whether the Legal Representative of an Enterprise which Fails to Go through the Annual Inspection within the Time Limit and therefore is Revoked of its Business License shall Bear Individual Liability of your Bureau (No. 37 [2002] of Shenzhen City Administrative Bureau of Industry and Commerce), upon study, we hereby give our reply as follows:

The annual inspection of enterprises is a legal system under which the administrative organs of industry and commerce carry out inspections on enterprises annually in accordance with the law, and confirm the qualifications of the enterprises to continue their business. Any enterprise shall accept the annual inspection in accordance with the law, and the failure to accept the annual inspection within the time limit shall constitute an illegal act. If an enterprise fails to accept the annual inspection within the time limit, and therefore its business license is revoked by the administrative organ of industry and commerce in accordance with the law, the legal representative of the enterprise as the responsible person to exercise the powers on behalf of the enterprise shall, due to his failure to perform the legal duties, bear the individual liability, unless the legal representative is unable to perform the duties normally during the annual inspection.

In accordance with Article 4 of the Provisions on the Administration of Registration of Enterprise Legal Representatives, if the business license of an enterprise is revoked due to an illegal act, the legal representative shall bear the individual liability for the illegal act of this enterprise, and shall not hold the post of legal representative within three years as of the revocation of the business license of the enterprise. If this person is still holding the post of legal representative in another enterprise, the relevant enterprise shall go through the registration of modification of the legal representative in accordance with the provisions. If the relevant enterprise fails to go through the registration of modification in accordance with the provisions, the administrative organ of industry and commerce shall, once finding this fact or verifying the report of this fact, order the enterprise to go through the registration of modification of the legal representative within a time limit. The enterprise failing to go through the modification registration within the time limit shall be punished by the administrative organ of industry and commerce in accordance with Article 12 of the Provisions on the Administration of Registration of Enterprise Legal Representatives.