...China's Evolving Bankruptcy Practice: The Enterprise Bankruptcy Law (EBL), which took effect in June 2007, is still an embryonic piece of legislation lacking practical details, transparency, and consistency in its interpretation and application. Court-administered bankruptcy proceedings have yet to be actively administered to Chinese corporates in financial difficulty, as evident from the relatively low number of bankruptcy petitions filed with China's four-level court system. Local Government's Involvement: The local government frequently plays an active and crucial role in court-administered reorganisation effort in China, such as coordinating with the administrator and the debtor company in search of strategic investors and negotiating with creditors. The local government's involvement can contribute to a time-efficient and smooth reorganisation process. However, maintaining employment and social stability are the top priorities of a local government, so the outcome of its intervention...
