JiangYu Wang, ‘Enforcing Fiduciary Duties as Tort Liability in Chinese Courts’

Abstract:
Fiduciary duties, once an Anglo-American concept, was codified in China’s Company Law in 2005, which made China one of the very few jurisdictions which introduced fiduciary duties through statutory provisions. Between successful or unsuccessful cases of legal transplant, China offers a third possibility on how the transplant of fiduciary duties may work in a civil law jurisdiction. It appears to be a rather simple model: the concept – or name – of fiduciary duties has been used by the courts to apply the doctrine of torts in civil law to the wrongdoings of corporate insiders such as the directors, officers and supervisors. In other words, the codification of fiduciary duties by China’s Company Law offers a room for the courts to use this concept as an authorisation by the law to impost tort liability on corporate wrongdoers, which they were not able to do before the codification. In this sense, the adoption of fiduciary duties in China’s corporate law plays an instrumental role in improving investor protection in China, although the judicial understanding and interpretation of fiduciary duties are probably far different from what the duties are understood in the origin countries.

Wang, JiangYu, Enforcing Fiduciary Duties as Tort Liability in Chinese Courts (August 16, 2017). In R Huang and N Howson (eds), Enforcement of Corporate and Securities Law: China and the World (pp 162-184). Cambridge: Cambridge University Press. doi:10.1017/9781316691397.011.

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