Supreme Law: Gu Xiaojuns false report of registered capital is obviously slightly harmful.

 Supreme Law: Gu Xiaojuns false report of registered capital is obviously slightly harmful.

Judge Pei Xianding:

After re-examination, it is clear that:

I. Facts about False Reporting of Registered Capital

In 2001, the plaintiff defendant Gu Xiaojun decided to set up Shunde Greencore with Gu Xiaojun and his father Gu Shanhong as shareholders and registered capital of 1.2 billion yuan in order to acquire the shares of Kelong Electrical Appliances. On October 22 of the same year, Greencore of Shunde completed the registration of the establishment of the company and obtained a business license without evaluation and verification of capital by means of a guarantee letter issued by the Peoples Government of Ronggui Town, Shunde City, Guangdong Province (later renamed Ronggui District Office). In April 2002, because the proportion of intangible assets in registered capital of Shunde Greencore reached 75%, far exceeding the legal limit of 20%, the industry and Commerce Department did not grant annual inspection. According to the letter issued by Ronggui District Office, the former Shunde City Industry and Commerce Department approved the annual inspection of Shunde Greencore.

In order to improve the registration procedures for the establishment of Greencore in Shunde and reduce the proportion of intangible assets in registered capital, from May to November 2002, under the arrangement of Gu Xiaojun, the plaintiff defendant, Liu Yizhong, Jiang Baojun and Zhang Xihan, adopted the method of transferring 187 million yuan of Kelong Electrical Appliances between Greencore accounts in Tianjin and Greencore accounts in Shunde to form Tianjin Green. Cole invested 660 million yuan of bank invoices in Greenkel, Shunde, and produced the receipt for the investment of 660 million yuan received by Greenkel, Tianjin, and the supply agreement for the advance payment of 660 million yuan for the refrigerant purchased by Greenkel, Shunde. Accordingly, the Shunde Gongcheng Accounting Firm issued the corresponding capital verification report. According to the capital verification report, Tianjin Greencole Board Resolution and Shunde Greencole Shareholder Resolution, the former Shunde Administration for Industry and Commerce approved the change registration of Shunde Greencole on December 23, 2002. After the registration of the change is completed, Gu Xiaojun will convert the replaced intangible assets of 660 million yuan into the capital accumulation fund of Shunde Greencore.

On October 27, 2005, the Standing Committee of the National Peoples Congress amended the Company Law of the Peoples Republic of China, allowing up to 70% of the registered capital of a limited liability company to be invested in non-monetary property.

On the basis of the facts and evidences confirmed by the re-examination, the Court has made a comprehensive judgement on the defendants Gu Xiaojun, Jiang Baojun, Zhang Xihan and their defendersdefenses and opinions on the crime of false reporting of registered capital, and the procurators appearing in the Supreme Peoples Procuratorate.

1. The plaintiff defendants Gu Xiaojun, Liu Yizhong, Jiang Baojun and Zhang Xihan falsely reported the registered capital.

2. The misrepresentation of registered capital by the defendants Gu Xiaojun, Liu Yizhong, Jiang Baojun and Zhang Xihan is obviously minor and harmless.

Source: Responsible Editor of Supreme Law Website: Wang Zheng_N7526