China has introduced a new bankruptcy law that gives creditors precedence over workers when it comes to claiming the assets of failed companies.
The law also means that, for the first time, private Chinese firms that have failed will be allowed to collapse.
Previously they existed in a legal limbo - their assets could not be released and their debts could not be struck from their creditors' books.
The change is seen as another step in China's move to a capitalist economy.
The new law further means that failed state enterprises can also now be officially liquidated for the first time.
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