Problems from the legal ambiguities of nominee shareholding agreement in China
Keywords:
Nominee Shareholding; Beneficial Ownership; Corporate Governance; Chinese Company Law; Legal TransparencyAbstract
This research critically examines the legal ambiguities surrounding nominee shareholding agreements in China, a practice increasingly prevalent within the corporate sector yet inadequately regulated under existing statutory frameworks. Relying on doctrinal legal analysis and comparative legal methods, the study identifies significant gaps in the Company Law and Civil Code, judicial inconsistencies in recognising beneficial ownership, and procedural barriers faced by anonymous shareholders. The findings reveal that while Chinese courts generally uphold nominee agreements as valid contracts, their treatment of shareholder qualification remains fragmented and unpredictable. Comparative analysis of the United States, United Kingdom, Germany, and Japan illustrates that balancing private autonomy with beneficial ownership transparency is feasible through targeted legislative reforms. Although China’s recent regulatory developments, including the introduction of beneficial ownership reporting obligations, represent progress, substantial deficiencies persist regarding the codification and protection of beneficial ownership rights. The research concludes that comprehensive legislative reform, harmonised judicial interpretation, and integration of international best practices are essential to enhance corporate governance, promote investment confidence, and align China's corporate regulatory framework with global standards. Addressing the nominee shareholding challenges is vital for achieving greater market stability and regulatory integrity.
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