Highlights of draft rules on Civil Code's basic principles

Lily Home, a public welfare program serving women's rights, was recently founded in Shanghai Jiading Industrial Zone in 2013. [Photo/Provided to chinadaily.com.cn]

4. Legal persons to be separated into two

Currently, China's laws generally separate legal persons into enterprises, government and judicial organs, public institutions and social groups. But after social development, more forms of social organizations appear, such as foundations, private non-enterprise units and social service organizations.

Draft: A for-profit legal person is one set on making profits and distributing the profit to its shareholders or other investors. A non-profit legal person is one set on public welfare or other non-profit purposes. A non-profit legal person cannot distribute interests to its founders and members.

Interpretation: It is a progress in classifying legal persons, which is suitable for the country's conditions, covering all sorts of social organizations, said Li Yongjun, a professor of China University of Political Science and Law and a participant in drafting the general rules.