Newsletter
CLARIFICATIONS OVER INDE-PENDENT DIRECTORS AND SUPERVISORS
As recently amended, Article 192 Paragraph 1 and Article 216 Paragraph 1 of the Company Law does not require companies to appoint di-rectors and supervisors solely from among their own shareholders. This allows companies to appoint independent directors and supervisors. But according to an interpretation by the MOEA dated 5 February 2002, independent directors and supervisors are limited to natural persons of full legal capacity, and may not include juristic persons.
With regard to the mode of appointment of in-dependent directors and supervisors, the MOEA stated in an interpretation dated 11 March 2002 that when a regular or special shareholders' meeting appoints directors or supervisors, it may not hold separate and distinct elections for in-dependent and non-independent directors and supervisors.
Further, in a resolution passed at a meeting held on 1 April 2002 to discuss points of doubt re-garding the Company Law and the Corporate Mergers and Acquisitions Law, the MOEA stated that if a government agency or corporate shareholder has been appointed a director or supervisor of a non-public-share-issuing com-pany under Article 27 of the Company Law, and it disposes of the entirety of its shareholding during its period of office, then the basis for its tenure ceases to exist, and its appointment as a director or supervisor is automatically termi-nated.