What directors and officers must a Chinese company have?

A Chinese limited liability company must have a legal representative, and that person must be the director who executes company affairs or the manager. It must have directors: a board of three or more, or a single director where the company is small. Since 1 July 2024 the supervisor can be dispensed with. The manager is optional.

Governance is the part of a Chinese company that gets set once, at registration, and is rarely opened again. The structure sitting in articles of association drafted before July 2024 follows the old law: a board of three, a supervisory post filled to complete the form, and a legal representative chosen because somebody had to sign. Under the Company Law as revised on 29 December 2023 and in force from 1 July 2024, the board can be one person, the supervisor can be dispensed with altogether, and the legal representative can no longer be whoever is willing.^⁠[1] Everything below is the limited liability company (有限责任公司), which is the form a wholly foreign-owned enterprise normally takes.

Who can be the legal representative?

The legal representative (法定代表人) is held, as the articles of association provide, by the director who executes the company’s affairs on its behalf, or by the manager.^⁠[1] Foreign founders often miss the constraint in that sentence: the post is no longer a free-standing appointment that can be handed to a shareholder, an adviser or a colleague in the parent company. It attaches to a job inside the Chinese entity, and the articles choose which of the two jobs.

Resignation follows the same logic. Where the director or manager holding the post resigns that role, the resignation counts as a resignation as legal representative at the same moment, and the company has 30 days from that date to determine a new one.^⁠[1] What the legal representative can bind the company to is Article 11, and a separate subject: see what a legal representative is in a Chinese company. Commentary that cites “Articles 10 and 11” for who may hold the post is citing one article too many; Article 11 does not deal with who holds it.^⁠[1]

How many directors does a Chinese company need?

A limited liability company establishes a board of directors, unless it uses the exception in Article 75.^⁠[2] The board has three or more members, with no statutory maximum since the 2023 revision, and its members may include employee representatives.^⁠[2] Where the company has 300 or more employees, an employee representative on the board is compulsory, unless the company has a lawfully constituted supervisory board that includes employee representatives. Employee representatives on the board are elected by the employees, through a workers’ congress (职工代表大会), a general meeting of employees or another democratic form.^⁠[2] A company of that size which takes the audit committee route described below has no supervisory board, so its board must include an employee representative.^⁠[1]

Article 75 is the exception: a company that is small in scale or has few shareholders may do without a board and appoint a single director, who exercises the powers the law gives the board, and that director may also serve as the company’s manager.^⁠[1] The article attaches no figure to either expression.

A director’s term is set by the articles and cannot exceed three years at a time, with re-election permitted. A resignation is given to the company in writing and takes effect when the company receives it, with one exception: where the term has expired without a replacement being elected, or where the resignation would take the board below the statutory minimum, the outgoing director goes on performing the duties until the replacement takes office.^⁠[2]

Does a Chinese company still need a supervisor?

Not necessarily, and for a small company that is the largest change in the 2023 revision. The default is unchanged: a limited liability company establishes a supervisory board (监事会).^⁠[1] A supervisory board always has three or more members, made up of shareholder representatives and an appropriate proportion of employee representatives, the employee proportion being not less than one third and the exact proportion fixed by the articles.^⁠[1] Two articles carve exceptions out of the default. Neither makes the board smaller; each replaces it with something else.

• An audit committee instead (Article 69). The company may provide in its articles for an audit committee (审计委员会) composed of directors, sitting within the board and exercising the powers the law gives the supervisory board. It is an alternative, not an addition: a company that does so has neither a supervisory board nor a supervisor. Employee representatives on the board may sit on the committee.^⁠[1]
• One supervisor, or none (Article 83). A company that is small in scale or has few shareholders may do without a supervisory board and appoint a single supervisor exercising the supervisory board’s powers. With the unanimous consent of all shareholders it may have no supervisor at all.^⁠[1]

A small single-shareholder WFOE can therefore arrive at one director under Article 75, and no supervisory board and no supervisor under Article 83. Neither exception applies by default. Article 69 works only as the articles of association provide, and without that provision the company has a supervisory board under Article 76 unless it comes within Article 83. Having no supervisor at all needs, in addition, the unanimous consent of every shareholder.^⁠[1]

A director or a senior manager (高级管理人员) cannot also serve as a supervisor. For a limited liability company, senior managers are the manager, any deputy manager, the person in charge of finance and anyone else the articles name.^⁠[1] In a WFOE whose one director is also the manager, the supervisor has to be someone else.

Is the manager a required post?

No. A limited liability company may have a manager (经理), appointed or dismissed by decision of the board. The manager answers to the board, exercises the powers the articles give or the board delegates, and attends board meetings without a vote.^⁠[1] The post becomes compulsory in one situation, which the company creates itself: if the articles make the manager the legal representative, there has to be a manager to hold it.

Post	Required?	Who may hold it	Nationality or residence condition
Legal representative(法定代表人)	Yes, exactly one	Only the director who executes the company’s affairs on its behalf, or the manager, whichever the articles provide	Not addressed in the article
Director(董事)	Yes. A board of three or more, or one director where the company is small in scale or has few shareholders	Members may include employee representatives of the company, and each term runs no more than three years	Not addressed in the article
Employee representative director(职工代表董事)	Only where the company has 300 or more employees and has no supervisory board including employee representatives	An employee representative, elected by the employees	Not addressed, but the seat is held by an employee of the company
Supervisory board(监事会)	Yes by default. Not where the articles set up an audit committee (Article 69), or where a small company uses Article 83	Three or more: shareholder representatives, and employee representatives making up at least one third. Not a director or senior manager	Not addressed, except that the employee seats are held by employees
Supervisor(监事)	No. One supervisor replaces the board in a small company, and with the unanimous consent of all shareholders there need be none	One individual, exercising the supervisory board’s powers. Not a director or senior manager	Not addressed in the article
Audit committee(审计委员会)	No. Only where the articles provide for it, and then there is no supervisory board and no supervisor	Directors; employee representatives on the board may be members	Not addressed in the article
Manager(经理)	No, unless the articles make the manager the legal representative	Appointed and dismissed by the board; a sole director may hold it as well	Not addressed in the article

What changed for older foreign-invested companies on 1 January 2025?

The Foreign Investment Law came into force on 1 January 2020. Enterprises established before then under the three laws it replaced, on equity joint ventures, wholly foreign-owned enterprises and contractual joint ventures, were given five years in which they could keep their original enterprise organisational form, with the implementing measures left to the State Council.^⁠[3] Those measures set the choice out plainly: within the five years an existing foreign-invested enterprise could adjust its organisational form and organs under the Company Law or the Partnership Enterprise Law and file the change of registration, or keep the old form.^⁠[4] The five years ended on 31 December 2024.

For a company already registered as a 公司 before 1 January 2020, the enterprise organisational form never had to change at all.^⁠[5] What had to change was the governance: the organs, the articles of association, and the filings that record them.

What follows non-conversion is narrow. From 1 January 2025 the market regulation department will not process the other registration items an unconverted enterprise applies for, and will publicise the circumstances.^⁠[4] SAMR’s own operating rule gives the trigger: the enterprise’s organisational form or organs do not comply with the mandatory provisions of the Company Law or the Partnership Enterprise Law, and it has not applied for the change of registration, the filing of its articles of association or the filing of its directors.^⁠[5] Registration items are the ordinary changes a working company files, so a change of address, a change of business scope, a new legal representative or an equity transfer is what stops.

What does not happen matters as much. Neither the Foreign Investment Law nor its Implementing Regulations attaches a fine to failing to convert, and neither dissolves the company, cancels the business licence or voids the governance documents already in place.^⁠[3,4] The penalties sit in the general registration rules, which apply to every company and not only to a foreign-invested one. They attach to a change that has been made and not recorded, not to non-conversion as such.^⁠[1,6]

Those rules sort what a company records into two kinds, with different penalties. Either kind must be recorded within 30 days of the resolution, the decision or the event that changed it, and most of what a conversion changes is a filing item rather than a registration item.^⁠[6]

Kind of item	What it covers	If a change is not recorded
Registration item(登记事项)	The name, entity type, business scope, domicile, registered capital and the legal representative’s name	An order to register within a time limit; once it passes, a fine of RMB 10,000 to RMB 100,000
Filing item(备案事项)	Among others, the articles of association, each shareholder’s subscribed contribution, and the directors, supervisors and senior managers	An order to correct; if the company refuses, a fine of up to RMB 50,000

Converting does not undo the original bargain either. Once an existing foreign-invested enterprise has lawfully adjusted its organisational form and organs, the methods the original joint venture or cooperative parties agreed for transferring equity or interests, for distributing profits and for distributing residual property may continue to be carried out as agreed.^⁠[4]

Which of the posts above a company actually has, and which of them its articles still require, is recorded in the articles and with the registration authority. The same articles carry the contribution deadline behind registered capital. Coordinating the filings is part of Company Setup & Compliance Coordination, and the shareholder documents behind them are the ones listed under what documents you need to register a WFOE.

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