This article is the first empirical study investigating the corporate reorganisation of Chinese domestically-listed companies. Through examining these cases, it challenges the assertion made by most of these corporate reorganisation plans and by Chinese state-run media reports that creditors and general public shareholders were the major beneficiaries. Through an analysis of the data generated from all forth-three such cases, this articles reveals that: First, unsecured creditors could have, on average, received 61.37% more of their claims if the fundamental value distribution principle, the absolute priority norm, could have been complied with in these reorganisations; Second, if the general-public-shareholder-protection scheme issued by the China Supreme People's Court could be rigorously implemented, 85.37% of the shares relinquished by general public shareholders could have been avoided. These two groups were not the winners.Instead, this article argues that it was local governments and controlling shareholders who were the real winners.

In 2006, Ch ina enacted its first rescue-oriented Enterprise Bankruptcy Law with the aim of establishing its corporate rescue culture. But the corporate reorganization procedure that is at the heart of the new bankruptcy law has not been used frequently. It is appropriate to ask why the use of China's new corporate rescue law has been so low. Meanwhile, in the existing corporate reorganizations under the 2006 Law, most debtors were excluded fro m the reorganizat ion process, so that the Chinese new debtorin-possession model, wh ich seems to be a desirable control fo rmat, was largely shelved. Why so? This article exp lores these two issues through the use of empirical data collected fro m Zhejiang, a p rovince with a significantly larger number of reorganizations than most other Chinese provinces .This article seeks to examine the main characteristics of China's new corporate reorganization regime enshrined in its newly-enacted Enterprise Bankruptcy Law of 2006 (the EBL 2006). Specifically, it explores two questions. First, it asks why China's new rescue law has not been widely used to rehabilitate troubled companies so as to save jobs and preserve going concern value. 1 Second, it asks why the administrator-in-possession approach rather than the legislated debtor-in-possession approach continues to be preferred in the majority of China's corporate reorganizations. 2 These issues are examined through the use of empirical data collected from Zhejiang province. Zhejiang was chosen for this detailed case study for the simple reason that nearly a quarter of China's corporate rescue cases between 2007 and 2010 were heard in this province; 3 as a result, Zhejiang offers a rich supply of data that allows generalizations about the use of China's new reorganization procedure to be made more confidently. Moreover, Zhang conducted twenty face-to-face interviews with actors who were directly involved in Zhejiang corporate rescues.

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This study empirically investigates China’s participation in the globalized cross-border insolvency collaboration system. It is the first time for the development of China’s cross-border insolvency law to be examined against the background of private international law on foreign judgment recognition and enforcement. The findings of this article reveal that foreign bankruptcy representatives face considerable difficulties in satisfying the treaty and reciprocity requirements when seeking judicial assistance from China, and that local protectionism in favour of China’s state-owned and state-linked companies undermines foreign bankruptcy representatives’ confidence in approaching China’s courts for support. Although there are several court recognitions of foreign bankruptcy judgments in China, this article finds that they are only used to acknowledge the legal status of foreign bankruptcy representatives to meet the demands of government authorities; Chinese courts have not taken a substantial step in recognizing a foreign bankruptcy judgment so as to bar individual creditors’ action in the interest of a foreign bankruptcy proceeding. On the contrary, for Chinese bankruptcy representatives seeking assistance abroad, they could take advantage of the liberal judicial infrastructure, especially of some advanced jurisdictions, to obtain recognition and relief.