Chinese government implemented the split-share structure reform in 2005, with an attempt to eliminate controlling shareholders' incentive to expropriate the minority shareholders' wealth through aligning the interest of controlling shareholders and minority shareholders. Using the sample of all companies listed on the Shenzhen and the Shanghai Stock Exchange during the years from 2002 to 2013, the study scrutinizes the impact of the split-share structure reform on the relationship between ultimate controlling shareholder and related party transactions. Through the PLS regression models, empirical results show that related party transactions are reduced after the split share structure reform in firms controlled by stateowned firms, especially in firms controlled by the central government. In addition, the second-largest shareholder tends to collude with the controlling shareholders and increase the use of related party transaction after the reform. Our findings have implications for policy makers and investors.