Core Viewpoint - The article discusses the significant amendments to the Enterprise Bankruptcy Law in China, marking its first revision in 18 years, with a focus on enhancing the efficiency of bankruptcy procedures and addressing the challenges faced by small and micro enterprises [3][6]. Summary by Sections Introduction - The draft of the revised Enterprise Bankruptcy Law has been presented for initial review, consisting of 16 chapters and 216 articles, which is a substantial increase from the previous 12 chapters and 136 articles [3]. Focus on Small and Micro Enterprises - The draft introduces special provisions for the bankruptcy procedures of small and micro enterprises, aiming to simplify the process and reduce costs, allowing for more efficient market exits or recoveries [6][7]. - However, the criteria for determining what constitutes a small or micro enterprise remain unclear, which may lead to implementation disputes [6][7]. Merging Bankruptcy Procedures - A new chapter on merging bankruptcy procedures for related enterprises has been added, establishing standards and principles for such cases, addressing the lack of national legal basis previously [7][8]. Coordination Mechanism - The draft introduces a bankruptcy work coordination mechanism, establishing a legal framework for government and court collaboration to address social issues arising from bankruptcies [10][11]. - This mechanism aims to improve the interaction between administrative and judicial processes, which is crucial for managing the broader impacts of bankruptcy [10]. Bankruptcy Prevention and Early Warning Mechanism - The draft emphasizes the importance of establishing a debtors' bankruptcy early warning mechanism, promoting information sharing and risk monitoring [12][13]. - While the draft proposes this mechanism, it lacks mandatory enforcement, which may limit its effectiveness [12][13]. Personal Bankruptcy Considerations - The draft addresses the issue of personal bankruptcy by allowing natural person shareholders who bear joint liability for corporate debts to clear their debts under certain conditions, marking a cautious step towards personal bankruptcy legislation [4][16]. - The article highlights the need for a phased approach to personal bankruptcy, focusing first on business-related debts before addressing consumer debts [17].

Core Viewpoint - The draft of the corporate bankruptcy law, which has undergone its first revision in 18 years, introduces significant changes, adding over 160 new and modified provisions, and aims to enhance the efficiency of bankruptcy proceedings and address existing shortcomings in the system [2][4]. Summary by Relevant Sections Legislative Changes - The draft consists of 16 chapters and 216 articles, significantly expanding from the current law's 12 chapters and 136 articles, marking a substantial overhaul of the bankruptcy framework [2]. - The revision aims to improve the orderly exit of businesses, promote fair competition, and optimize resource allocation in the market [2]. Focus on Small and Micro Enterprises - New provisions specifically cater to small and micro enterprises, allowing for simplified bankruptcy procedures, such as single-judge hearings and the absence of creditor committees, to reduce costs and enhance efficiency [4][6]. - However, the criteria for determining which enterprises qualify as small or micro remain vague, potentially leading to implementation disputes [4]. Coordination Mechanisms - The draft introduces a bankruptcy work coordination mechanism, establishing a legal basis for government and court collaboration in managing bankruptcy-related social issues, asset disposal, and credit restoration [7][8]. - This mechanism aims to address the intersection of bankruptcy law with other legal frameworks and social stability concerns [7]. Pre-Bankruptcy Measures - The draft emphasizes the importance of pre-bankruptcy preventive measures, proposing the establishment of a debtor bankruptcy warning mechanism to monitor and alert on debt risks [10][11]. - This approach aims to intervene early in financial distress situations, although it lacks mandatory enforcement [10]. Personal Bankruptcy Considerations - The draft addresses the contentious issue of personal bankruptcy by allowing natural person shareholders who bear joint liability for corporate debts to clear their debts under certain conditions, marking a cautious step towards personal bankruptcy legislation [3][13]. - The approach reflects a phased strategy, focusing first on business-related debts before addressing consumer debts [15].