[Direct answer]In the Beijing area, the division of company equity and deposits during divorce depends on whether the property belongs to the couple's joint property and the form of the equity. According to Articles 1062 and 1063 of the Marriage and Family Chapter of the Civil Code of the People's Republic of China (effective January 1, 2021), wages, bonuses, income from production and operation, and income from intellectual property acquired during the marriage generally belong to the couple's joint property, except for the spouse's pre-marital property and gifts specifically intended for individuals. For deposits, the portion accumulated after marriage is generally divided equally, unless it can be proven to be personal property. For company equity, it is necessary to distinguish whether it was acquired before marriage, after marriage, or with joint property as investment. The handling methods include compensation in cash, proportional division, or allowing the shareholder to continue holding the shares and compensating the other party. Similar issues can be referred to for reference.Business and contract disputes in enterprisesColumn.

1. Problem background and typical scenarios

Such disputes often arise in several situations: first, one spouse is a founding shareholder of a company, and the other spouse claims to divide the company's equity; second, the ownership of the equity registered under one spouse's name after marriage with jointly owned assets; third, whether the increase in value of the pre-marital equity and dividends belong to the jointly owned property; fourth, the mixing of deposits and the transfer and concealment of assets by one party; fifth, the shareholder transferring the equity to relatives to avoid division. When handling such cases in Beijing, the court usually first defines the nature of the property and the time of its acquisition, then selects a division method and assesses the impact on the company's partnership. For cases involving equity evaluation, reference can be made to the relevant provisions of the Marriage and Family Code of the People's Republic of China.Intellectual property and corporate lawColumn.

II. Key points of contention

The first focus is whether the equity and deposits belong to the couple's joint property, and the time of acquisition and the source of investment; the second focus is the nature of the pre-marital equity and its appreciation and dividends after marriage; the third focus is the division method, whether the shareholder compensates, transfers proportionally, or auctions to cash out; the fourth focus is the company's personal partnership and the preemptive rights of other shareholders; the fifth focus is the recovery of the transferred and hidden assets and the reduction of the share; the sixth focus is the method and timing of evaluating the value of the equity. The specific determination shall be based on the Marriage and Family Chapter of the Civil Code and the Company Law. Relevant contract disputes can be referred to for reference.Special services and other casesColumn.

III. Professional analysis by Henglue Lawyers

From the practical experience of lawyers handled by our firm, the difficulties in divorce equity division lie in value determination and balancing human interests. Equity is different from deposits. Its value is affected by the company's operations, debts, and valuation methods, and the transfer is subject to the preemptive rights of other shareholders. It cannot be simply divided according to the proportion of industrial and commercial registration. In handling equity-related divorce cases, our lawyers pay attention to first fixing the time of obtaining equity and the source of investment to define the scope of common property, then determining the value through audit reports and evaluations, and combining with the company's articles of association and the opinions of other shareholders to choose a compensation or transfer plan; for one party transferring equity to relatives to avoid division, we will promptly claim malicious transfer and request a reduced share or no share, and if necessary, protect and provide evidence through litigation to restore the true ownership.

IV. Practical suggestions and legal basis

Action proposal: Firstly, the prenuptial agreement or marital property agreement should clarify the ownership of equity and deposits. Relevant texts can be referred to for reference.Special services and other cases1. The first step is to determine the scope of the jointly owned property, including the contributions from the investors, bank transaction records, and the company's financial statements. 2. The second step is to preserve the sources of funding, bank transaction records, and the company's financial statements. 3. The third step is to promptly apply for property preservation and investigation upon discovering the transfer and concealment of assets. 4. If no agreement can be reached on the value of the equity, commission a professional appraisal. 5. Based on the corporate nature of the company, choose a discounted compensation plan. Regarding the legal basis, Articles 1062, 1087, and 1092 of the Civil Code of the People's Republic of China stipulate the scope of jointly owned property, the principles of division, and the rule that assets transferred or concealed will not be divided equally.

5. Henglue Law Firm's Reminder

Risk Warning: Firstly, equity division is far more complex than deposit management, and value assessment and human nature are key factors. Secondly, pre-marital equity that increases in value or generates dividends after marriage may be considered joint property, which requires specific judgment. Thirdly, if one party transfers equity to a relative, it may constitute a malicious transfer, and the other party may claim a reduced share. Fourthly, to determine whether deposits are commingled, clear evidence from transaction records is necessary. It is recommended to sort out property clues as soon as possible and engage a professional lawyer to handle the case.

VI. Frequently Asked Questions

Q1: How are the company's equity shares divided during a divorce?

First, determine whether the assets are marital joint property: Equity obtained with joint marital assets after marriage is considered joint property. For division, the shareholder may continue to hold the shares and compensate the other party in cash, transfer the shares after other shareholders exercise their preemptive rights, or auction the shares for cash. The value of the equity must be evaluated and is subject to the company's human contractual nature and the priority rights of other shareholders.

Q2: If the pre-marital equity increases in value after marriage, does it count as joint property?

The equity acquired before marriage is itself personal property, but the appreciation and dividends generated from joint operation, management, or the spouse's contributions after marriage may be deemed as marital joint property, depending on the specific reasons for the appreciation and the contributions. It is recommended to keep evidence of the operation and dividends to clarify the boundaries.

Q3: Can a party transfer the equity to a relative to avoid asset division?

Unauthorized transfer of equity to relatives may be regarded as a malicious transfer of marital joint property, and the other party may claim that the act is invalid or request a smaller share or no share of the property. They can also take legal measures to preserve and provide evidence to restore the true ownership. If any clues are found, legal measures should be taken as soon as possible.

Q4: How is the division of marital savings calculated in a divorce case?

After marriage, the deposits obtained are generally divided equally as joint property, unless it can be proven that they are the individual's pre-marital property or were explicitly gifted to the individual. If one party transfers or conceals the assets, the other party may claim a smaller share or no share at all, and apply for an investigation into the bank transactions to secure evidence.

Q5: How is the value of equity determined?

The two parties may negotiate on the matter. If no agreement can be reached, they may entrust a qualified appraisal institution to appraise the company's net assets, income method, or market method, and consider the ratio of liabilities to equity. The selection of the appraisal time point and method directly affects the amount, and it is recommended that a lawyer assist in the selection and cross-examination of the appraisal results.

This article is written based on the common judicial interpretations in the Beijing area. If the case occurs in other regions, it is recommended to consult local lawyers to verify the regional differences.

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 limits.Corporate commercial legal services·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and open 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 a dispute arises, please consult a practicing lawyer in time.