JC Master Case | Attorney Tang Xuebin of JC Master (Taizhou) Successfully Represented an International Commercial Dispute Arising from a Share Transfer

Recently, a dispute over a request to amend company registration—arising from an equity transfer—represented by Attorney Tang Xuebin, Executive Director of JC Master (Taizhou), was adjudicated in favor of the client, thereby fully safeguarding the client’s legitimate rights and interests and earning the client’s high praise.
 

Company B, Corporation C (a legal entity duly registered in Japan), and four natural persons—two of whom are nationals of Taiwan, China, and two of whom are Japanese nationals—serve as shareholders of Company A. Originally, they resolved to bring in Company D as a partner through a capital‑increase arrangement; however, during the course of negotiations, Corporation C and two Japanese shareholder‑natural persons privately entered into an agreement with Company D regarding the transfer of their equity interests. They subsequently notified the other shareholders and the board of directors in writing, seeking their consent to such transfer. Upon the expiration of a thirty‑day period during which no definitive response was received from the other shareholders or the board, Corporation C, the two Japanese shareholders, and Company D executed an equity‑transfer agreement, pursuant to which they assigned all of their shares in Company A to Company D. Subsequently, when Company D sought to have Company A effect the registration of the change in shareholding, its request was denied. Accordingly, Company D brought suit against Company A, requesting that it be registered as a shareholder of Company A.

This case is a dispute arising from an equity transfer, involving commercial entities from Japan, Taiwan, and mainland China. Given the large number of parties involved and the significant controversies surrounding the applicable law, after its first court appearance, Company A, finding the matter highly complex and difficult, retained Attorney Tang Xuebin to represent it. Upon accepting the mandate, Attorney Tang led his team in conducting an in-depth analysis of the case, thoroughly examining such details as the original intentions of each shareholder in establishing Company A, the negotiation process among the parties, the true purpose of the equity transaction, and the core points of contention. At the same time, he meticulously reviewed all provisions of the company’s articles of association and the shareholders’ agreement, with particular focus on the key clauses governing the sale of equity interests. In the absence of clear statutory guidance addressing the central issues at stake, Attorney Tang, drawing on his extensive theoretical knowledge and practical experience in civil and commercial law, and taking into account the closed‑nature and personal‑relationship‑oriented characteristics of limited liability companies, together with the purposes underlying the company’s establishment and the execution of the shareholders’ agreement, formulated a dual defense strategy based on “procedural irregularities” and “transactions entered into in bad faith.” On this basis, he gathered and submitted copious additional evidence, and through rigorous legal reasoning and evidentiary support, argued that the equity transfer in question should not produce any legal effect vis‑à‑vis Company A, and that Company A is entitled to refuse to effect the corresponding registration amendment.
 

In this case, from the date of acceptance to the transfer and the designation of jurisdiction, six court hearings were held over a period of two years. Ultimately, the court duly adopted the arguments advanced by Attorney Tang Xuebin and dismissed the claims brought by Company Ding. Neither the plaintiff, Company Ding, nor the third party, Corporation C, nor the two Japanese individual shareholders filed an appeal. At present, the first-instance judgment has become final, yielding a highly satisfactory outcome.

The favorable judgment in Case A once again underscores the pivotal role of a company’s articles of association in corporate governance. When structuring a company’s equity framework, shareholders should align their plans with both legal requirements and business objectives, have the articles drafted by qualified attorneys, and ensure that all shareholders, directors, supervisors, and senior management strictly comply with them, thereby mitigating potential legal risks going forward.
 

JC Master Lawyers consistently places clients at the center of everything we do, delivering high‑quality, efficient legal services. Upholding the principle of “putting client interests first and prioritizing professional excellence,” we continuously innovate and keep pace with the times. For many years, Attorney Tang Xuebin’s team has focused on corporate law, commercial litigation, and arbitration. If you would like to discuss or seek advice, please feel free to contact us!

Lawyer Tang Xuebin Executive Director of JC Master (Taizhou) Law Office

Member of the Chinese Peasants and Workers Democratic Party and a member of the CPPCC Committee of Gaogang District, Taizhou City;

Legislative Consultation Advisor to the Taizhou Municipal Committee of the Chinese People’s Political Consultative Conference;

Member of the Corporate Law Committee of the Jiangsu Provincial Lawyers Association;

Deputy Director (in charge of daily operations) of the Corporate Law and Corporate Legal Counsel Committee of the Taizhou Lawyers Association;

Deputy Director of the Social and Legal Affairs Committee of the Taizhou Municipal Committee of the China National Democratic Construction Association;

Director of the Legal Affairs Professional Committee of the Taizhou Medical Industry Public Relations Society.

Professional Expertise

He/She has extensive professional experience in corporate law and legal advisory services, corporate governance and equity structure design, as well as in handling various economic contract disputes, labor disputes, anti-unfair competition matters, and trademark infringement cases.
This article is published by Jiangsu JC Master Law Office. The author is Jiangsu JC Master Law Office, and the copyright belongs to the author. Please cite the original source when reprinting; violations will be prosecuted.

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