Legal basis: People's Republic of China (PRC) Company Law.
Article 21 The controlling shareholders, actual controllers, directors, supervisors and senior managers of a company shall not use their related relationships to harm the interests of the company. Anyone who violates the provisions of the preceding paragraph and causes losses to the company shall be liable for compensation.
Article 22 The resolutions of the shareholders' meeting, the shareholders' meeting and the board of directors of the company are invalid if they violate laws and administrative regulations. If the convening procedure and voting method of the shareholders' meeting, shareholders' general meeting or the board of directors violate laws, administrative regulations or the articles of association, or the contents of the resolution violate the articles of association, the shareholders may request the people's court to cancel it within 60 days from the date of making the resolution. Where a shareholder brings a lawsuit in accordance with the provisions of the preceding paragraph, the people's court may, at the request of the company, require the shareholder to provide corresponding guarantees. If the company has gone through the registration of change according to the resolution of the shareholders' meeting or the shareholders' meeting or the board of directors, after the people's court declares the resolution invalid or cancels the resolution, the company shall apply to the company registration authority for cancellation of the registration of change.
Article 147 Directors, supervisors and senior managers shall abide by laws, administrative regulations and the articles of association of the company, and have the obligation of loyalty and diligence to the company. Directors, supervisors and senior management personnel shall not take advantage of their powers to accept bribes or other illegal income, and shall not encroach on the company's property.
Article 148 Prohibited acts of directors and senior managers
Directors and senior managers shall not commit the following acts: (1) misappropriating company funds; (2) Opening an account for the company's funds in its own name or in the name of other individuals. (3) Lending the company's funds to others or providing guarantee for others with the company's property without the consent of the shareholders' meeting, the shareholders' general meeting or the board of directors, in violation of the provisions of the company's articles of association; (four) in violation of the articles of association of the company or without the consent of the shareholders' meeting or the shareholders' meeting, enter into a contract or conduct a transaction with the company; (5) Without the consent of the shareholders' meeting or shareholders' meeting, taking advantage of his position to seek business opportunities belonging to the company for himself or others, and running the same business as the company he works for; (six) accept the entrustment of others and regard the transaction with the company as your own; (seven) unauthorized disclosure of company secrets; (8) Other acts that violate the obligation of loyalty to the company. The income of directors and senior managers who violate the provisions of the preceding paragraph shall be owned by the company.
Article 149 Directors, supervisors and senior managers who violate laws, administrative regulations or the articles of association when performing their duties in the company and cause losses to the company shall be liable for compensation.