Law of China on Partnerships Ⅲ

　　Article 64 A limited partner may make capital contributions in cash or in kind, with intellectual property rights, land-use right, or other property rights, the values of which are assessed.

　　A limited partner shall not make capital contributions in the form of labor services.

　　Article 65 A limited partner shall make his capital contributions in full and on schedule, as are agreed upon in the partnership agreement; if he fails to do so, he shall be obligated to make up the difference and bear liability to the other partners for breach of agreement.

　　Article 66 Among the items to be registered by a limited liability partnership shall be included the names or titles of the limited partners and the amount of capital contributions subscribed for by each of them.

　　Article 67 The affairs of a limited liability partnership shall be managed by the general partners of the partnership. The managing partners may demand that payment for management of affairs and the way of drawing such payment be stipulated in the partnership agreement.

　　Article 68 A limited partner of a limited liability partnership shall not manage partnership affairs or represent the partnership in its relations with people outside the partnership.

　　The following acts of a limited partner shall not be deemed to be management of partnership affairs:

　　（1） to participate in deciding on a general partner's entering into or retiring from the partnership;

　　（2） to raise suggestions concerning the operation and management of the partnership;

　　（3） to participate in the selection of a public accounting firm responsible for providing auditing services to the partnership;

　　（4） to obtain the audited financial statements of the partnership;

　　（5） where his personal interests are involved, to consult the financial materials of the partnership such as the accounting books;

　　（6） when his interests in the partnership are infringed upon, to claim his rights from the partners who are liable or to initiate a lawsuit;

　　（7） when the managing partners neglect to exercise their rights, to urge them to do so, or to initiate a lawsuit in his own name for the benefit of the partnership; and

　　（8） to provide guaranty for the partnership according to law.

　　Article 69 A limited liability partnership shall not distribute all the profits to part of the partners, unless otherwise stipulated in the partnership agreement.

　　Article 70 A limited partner of a limited liability partnership may conduct transactions with the partnership, unless otherwise stipulated in the partnership agreement.

　　Article 71 A limited partner of a limited liability partnership may, by himself or in cooperation with others, engage in business in competition with the partnership, unless otherwise stipulated in the partnership agreement.

　　Article 72 A limited partner may pledge his share of property in the limited liability partnership, unless otherwise stipulated in the partnership agreement.

　　Article 73 A limited partner may, in accordance with the partnership agreement, assign his share of property in the limited liability partnership to persons other than the partners of the partnership, provided that he notifies the other partners 30 day in advance.

　　Article 74 Where a limited partner's personal property is insufficient to pay off his debts unrelated to the limited liability partnership, he may use his share of income from the limited liability partnership to pay off such debts; and the creditor may, according to law, request the people's court to compulsorily execute the partner's share of property in the limited liability partnership for payment.

　　Where a people's court compulsorily executes the share of property of a limited partner in a limited liability partnership, it shall notify all the partners. Under equal conditions, the other partners shall have first priority to purchase the property in question.

　　Article 75 A limited liability partnership shall be dissolved when there are only limited partners left in the partnership; and it shall be transformed into a general partnership when there are only general partners left.

　　Article 76 Where a third party is justified in believing that a limited partner is a general partner and transacts a deal with him, the limited partner in question shall bear the same liability for the deal as a general partner does.

　　Where without authorization a limited partner transacts a deal with another person in the name of the limited liability partnership and thus causes losses to the partnership or other partners, the said partner shall be liable for the losses.

　　Article 77 A new limited partner shall, within the amount of the capital contributions subscribed for by him, be liable for the debts the limited liability partnership incurs prior to his entering into the partnership.

　　Article 78 A limited partner shall naturally retire from the partnership under any of the situations prescribed in Subparagraphs （1） and （3） through （5） of the first paragraph in Article 48 of this Law.

　　Article 79 When during the existence of a limited liability partnership, a limited partner who is a natural person loses the capacity for civil conduct, the other partners shall not demand that he retire from the partnership for that reason.

　　Article 80 When a limited partner who is a natural person is deceased or legally declared dead, or a limited partner which is a legal person or other organization is terminated, the successor or the successor in title may obtain the status of the aforementioned limited partner in the partnership according to law.

　　Article 81 After a limited partner retires from a limited liability partnership, he shall be liable, with the property he takes back from the limited liability partnership upon his retirement, for the debts the partnership comes to owe due to causes that arise prior to his retirement from the partnership.

　　Article 82 Unless otherwise stipulated in the partnership agreement, a general partner to become a limited partner or vice versa shall be subject to consent of all the partners.

　　Article 83 Where a limited partner becomes a general partner, he shall bear unlimited joint and several liability for the debts the partnership incurs during the period he is a limited partner.

　　Article 84 Where a general partner becomes a limited partner, he shall bear unlimited joint and several liability for the debts the partnership incurs during the period he is a general partner.

　　Chapter IV

　　Dissolution and Liquidation of a Partnership

　　Article 85 A partnership shall be dissolved in one of the following situations:

　　（1） At the expiration of the period of time for partnership, the partners decide not to continue operation;

　　（2） The cause for dissolution specified in the partnership agreement arises;

　　（3） All the partners decide to dissolve;

　　（4） The number of partners does not meet the statutory requirement for 30 days;

　　（5） The objectives of partnership specified in the partnership agreement have been achieved or it is impossible to achieve them;

　　（6） Its business license is revoked, or it is ordered to close down or is dissolved, according to law; or

　　（7） Other reasons provided for by laws or administrative regulations arise.

　　Article 86 Where a partnership is dissolved, it shall be liquidated by liquidators.

　　All of the partners shall serve as liquidators or, upon agreement by the majority of all the partners, one or more partners may be designated, or a third person may be authorized, to act as liquidators within 15 days after the cause for dissolution of the partnership arises.

　　Where no liquidators are decided on within 15 days after the cause for dissolution of the partnership arises, the partners or other interested parties may apply to a people's court for designation of liquidators.

　　Article 87 During liquidation, a liquidator shall manage the following affairs:

　　（1） checking up on the property of the partnership and prepare a statement of assets and liabilities and an inventory of the property separately;

　　（2） dealing with the outstanding partnership affairs which are relevant to liquidation;

　　（3） paying off the taxes owed by the partnership;

　　（4） clearing up claims and debts;

　　（5） disposing of the residual property of the partnership after paying off the debts; and

　　（6） participating in proceedings or arbitrations on behalf of the partnership.

　　Article 88 A liquidator shall, within 10 days from the date a decision is made on his serving as such, notify the creditors of the intended dissolution of the partnership and shall make an announcement in a newspaper within 60 days. The creditors shall, within 30 days from the date they receive the notice, file their claims to the liquidator, and the creditors who fail to receive the notice shall do so within 45 days from the date the announcement is made.

　　When a creditor files a claim, he shall specify the matters related to the claim and provide the relevant document of proof. The liquidator shall register such a claim.

　　During the period of liquidation, the partnership shall remain in existence, however, it shall not engage in any business activities unrelated to liquidation.

　　Article 89 After payment with the partnership property of the liquidation expenses, the wages, social insurance premiums and statutory compensation of the employees and the taxes due and debts owed by the partnership, the residual property shall be distributed according to the provisions in the first paragraph of Article 33 of this Law.

　　Article 90 Upon conclusion of liquidation, the liquidator shall prepare a liquidation report and shall, after having it signed by, and affixed with the seals of, all the partners, submit it to the enterprise registration authority within 15 days and apply for cancellation of the registration of the partnership.

　　Article 91 After the registration of a partnership is cancelled, the former general partners shall still bear unlimited joint and several liability for the debts the partnership incurs during the period of its existence.

　　Article 92 Where a partnership is unable to pay off the debts due, its creditors may, according to law, apply to a people's court for bankruptcy liquidation of the partnership, or demand that the general partners pay off such debts.

　　Where a partnership is declared bankrupt according to law, its general partners shall still bear unlimited joint and several liability for the debts of the partnership.