[Direct answer]In principle, it does not have legal effect on the company. According to Article 504 of the Civil Code of the People's Republic of China (effective from January 1, 2021) and Articles 7 and 9 of the Interpretation of the Supreme People's Court on the Application of the Guarantee System of the Civil Code of the People's Republic of China (Fa Shi [2020] No. 28), if the legal representative of the company provides guarantees beyond his authority, if the counterparty is in good faith, the guarantee contract will have legal effect on the company; if the counterparty is not in good faith, it will not have legal effect on the company. Listed companies also need to obtain resolutions and announcements in accordance with the Company Law of the People's Republic of China and securities regulatory requirements when providing external guarantees. If the counterparty fails to review the announcement, it generally does not constitute good faith, and the guarantee will not have legal effect on the company, and the company will not bear guarantee responsibility. If the company is at fault, it may bear corresponding compensation liability. The action direction is to review whether the guarantee has been resolved and announced, and based on this, to determine whether and to what extent the company is liable.

1. Problem background and typical scenarios

When problems arise in listed companies, a series of illegal guarantees often come to light: guarantees made without the resolution of the shareholders' meeting, without announcement, or even signed privately by the actual controllers. Creditors once thought that having the backing of a listed company would ensure complete safety, but later found that the guarantees might be worthless on paper. The validity of illegal guarantees and whether creditors can hold the company accountable depend on procedural requirements such as resolutions and announcements.

II. Key points of contention

First, the requirements for resolutions and announcements of guarantees by listed companies. Second, the determination of the counterparty's good faith in the case of ultra vires guarantees. Third, the company's liability for compensation after the guarantee becomes ineffective. Fourth, the responsibility of actual controllers and senior executives for making guarantees without authorization. Fifth, the handling of the main debt after the guarantee becomes invalid.

III. Professional analysis by Henglue Law Firm

The determination of the effectiveness of illegal guarantees by listed companies hinges on the "procedural requirements plus good faith requirements". According to the Company Law of the People's Republic of China and securities regulatory requirements, listed companies typically need to obtain the resolution of the board of directors or the shareholders' meeting and make a public announcement before providing guarantees to third parties. When the legal representative of the company provides guarantees beyond his/her authority, whether the counterparty acted in good faith determines whether the guarantee is effective against the company. According to the Interpretation of the Supreme People's Court on the Application of the Guarantee System of the Civil Code of the People's Republic of China (Law Interpretation [2020] No. 28), "good faith" refers to the counterparty not knowing and not being supposed to know that the legal representative exceeded his/her authority. To claim good faith, the counterparty must prove that he/she has conducted a formal review of the resolution. For listed companies, the interpretation further clarifies that if the counterparty enters into a guarantee contract with the listed company without relying on the information disclosed by the listed company that the guarantee matters have been approved by the board of directors or the shareholders' meeting, and the listed company claims that the guarantee contract is not effective against it and does not bear guarantee responsibility or compensation liability, the people's court shall support it. When handling such matters, Henglue Lawyers usually first verify whether there is a resolution for the guarantee, whether the resolution is true and complete, and whether it has been announced, and then determine whether the counterparty has fulfilled its review obligations. If the guarantee is not effective against the company, the company generally does not bear guarantee responsibility, but may bear corresponding compensation liability due to negligence. At the same time, illegal guarantees often involve the responsibilities of actual controllers, directors, supervisors, and senior management, as well as administrative and criminal liabilities for information disclosure violations. For creditors, checking the announcements, keeping copies of the resolutions, and verifying their authenticity before signing contracts are key to risk prevention. If illegal guarantees are discovered after the fact, it is necessary to promptly evaluate the liability path and consider asserting rights against relevant responsible parties. 上市公司违规担保的效力判断，核心在于“程序要件加善意要件”。依《中华人民共和国公司法》及证券监管要求，上市公司对外提供担保通常须经董事会或者股东大会决议并公告；公司法定代表人越权担保时，相对人是否善意决定担保对公司是否发生效力。依《最高人民法院关于适用〈中华人民共和国民法典〉有关担保制度的解释》（法释〔2020〕28号），善意是指相对人不知道且不应当知道法定代表人超越权限；相对人主张善意须证明其已对决议进行形式审查。对上市公司而言，该解释进一步明确，相对人未根据上市公司公开披露的关于担保事项已经董事会或者股东大会决议通过的信息，与上市公司订立担保合同，上市公司主张担保合同对其不发生效力、且不承担担保责任或者赔偿责任的，人民法院应予支持。恒略律师在处理此类事务时，通常先核查担保是否有决议、决议是否真实完整、是否已公告，再判断相对人是否尽到审查义务。担保对公司不发生效力的，公司一般不承担担保责任，但可能依过错承担相应赔偿责任；同时，违规担保往往还牵涉实际控制人、董监高的责任与信息披露违规的行政、刑事责任。对债权人而言，签约前查阅公告、留存决议影印件并核实真实性，是防范风险的关键；事后发现违规担保的，应及时评估责任路径并考虑对相关责任主体主张权利。

IV. Practical suggestions and legal basis

Action List: 1. Verify whether the guarantee has been approved by the board of directors or shareholders' meeting and announced publicly; 2. Assess whether the counterparty has fulfilled its obligations of formal review and good faith; 3. If the guarantee is not effective for the company, evaluate the company's liability for fault compensation; 4. Hold the actual controllers and senior executives accountable for their unauthorized guarantees; 5. Pay attention to the joint consequences of the handling of the main debt and violations of information disclosure. Main legal basis: Articles 504 and 681 of the Civil Code of the People's Republic of China (effective from January 1, 2021); Articles 7 and 9 of the Interpretation of the Supreme People's Court on the Application of the Civil Code of the People's Republic of China to the Guarantee System (Law Interpretation [2020] No. 28); Provisions of the Company Law of the People's Republic of China on the company's resolution on external guarantees; The specific application shall be subject to the currently effective laws, regulations, and judicial rulings.

5. Henglu Law Firm's Advice

There are three key points regarding illegal guarantees by listed companies: guarantees require both a resolution and an announcement; if the counterparty fails to check the announcement, they are generally not considered acting in good faith, and the guarantee will not be effective for the company; and creditors should check the announcement and keep the resolution before signing the contract. For disputes involving corporate commercial and contractual matters, you can seek legal assistance through the following channels:Business and contract disputes in enterprisesWe can provide a comprehensive solution for services involving cross-border investment and financing\nFinancial capital and cross-border transactions involving foreign entitiesFor more information on corporate law, please refer to the relevant sectionIntellectual property and corporate lawThe column covers topics related to criminal border issues and provides consultation services on these matters.Criminal defenseFor those involved in debt collection, please feel free to contact our team for more information.Creditor's rights and debts, and enforcementFor any questions or difficulties, please contact us via the column's contact information.Special servicesTeam.

VI. Frequently Asked Questions

Q1: Is the guarantee from a listed company valid if it hasn't been announced publicly?

Generally, it has no legal effect on the company. If the counterparty fails to review the resolution based on the publicly disclosed information, it usually does not constitute good faith, and the company may claim not to bear the guarantee responsibility or compensation liability.

Q2: What materials are needed to review the guarantees provided by listed companies?

The company should keep copies of company announcements, resolutions of the board of directors or shareholders' meetings, articles of association, and business registration information, and record the review process to prove that it has fulfilled its obligation of formal review.

Q3: How much does it cost to handle such disputes?

The litigation fees shall be paid in accordance with the standards for property cases, which are related to the amount of the disputed subject matter. Additional fees may be charged for appraisals and investigations, and the specific amounts shall be determined by the court and the relevant institutions.

Q4: How long does it take from the filing of a lawsuit to the issuance of a verdict?

The first-instance ordinary procedure usually lasts for several months, and it will take longer if it involves adding parties, appraisal, or appeals. Determining the effectiveness of the guarantee is often the focus of the trial.

Q5: If the guarantee is not effective for the company, do creditors still have any options?

It can assess whether the company is at fault and claim corresponding compensation liability; at the same time, it can claim liability from the actual controllers, directors, supervisors, and senior executives, or from the entities that forged resolutions, and, depending on the circumstances, pursue criminal responsibility.

The above answer is based on the judicial practice in Beijing. The judicial interpretations in other provinces and cities may vary. For specific cases, please refer to the local rules and evidence situation.

If you are currently facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the necessary evidence, to avoid missing the statutory time limit.Corporate commercial legal services·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and public adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If you encounter disputes, please consult a practicing lawyer in time.