Professor Shi Jianzhong from China University of Political Science and Law explains.

"As they are husband and wife, how they agree on the proportions in providing capital for setting up their company is an issue governed by the Corporation Law. At the same time, all the shares and the assets represented by the shares will turn into their family property and family property shall be subject to the Marriage Law. So the handling of such cases involves the coordination of both the Marriage Law and the Corporation Law."

The expert warns that a divorce between a company's two shareholders can have a detrimental effect on the company's operation. How could such disputes be avoided? Professor Shi Jianzhong explains.

"Those couples who are ready to form their own companies must make arrangements for the risks in advance. Namely, they'd better stipulate in the company's constitution how to divide the stock ownership. Without such agreement, one party's share in the company would be treated as family property held in common by husband and wife. It will be divided up 50:50, unless otherwise agreed. In fact, in this special type of company, once the corporate constitution regulates their relations as shareholders, it also regulates their relations as couples."

With that, we end this week's Frontline. If you have any comments and suggestions, don't hesitate to write to us, either by email or post. Our address is crieng@crifm.com. Alternatively, you can send a letter to: English Service, China Radio International, Beijing, China. The postal code is 100040. For program producer Wang Lei, I am Wu Jia. Thank you for listening. Until next week, goodbye.