On The Issue Of Business Reputation Investment

Along with the development of the economy, Business Reputation plays a more and more important role in corporation and company management. Law, however, ignores the economic phenomenon. Even the exciting newly revised Company Law does not make any change, and it definitely prohibits Business Reputation to be invested. By using the comparison and economic law analysis, this thesis researches the legal regulation of shareholder's Business Reputation investment, with the principle of efficiency and autonomy through the thesis.This thesis introduces basic knowledge such as the concept, the characters, and the nature of Business Reputation at first. Then it analyzes the reason why China's Company Law prohibits the Business Reputation investment, and figures out the impropriety of this regulation as well. The following part discusses the legitimacy and the meaning of Business Reputation investment, which is for the feasibility of this investment on both the positive and the negative sides. A design of Business Reputation investment legal system is given in the final part of this thesis. Business Reputation refers that a comprehensive social evaluation of business body's objective ability of debt repayment and subjective willing to repay in its business activities, which is an intangible asset combined of various elements. Business Reputation, as an intangible asset, once invested will produce huge economical value. But China's Company Law prohibits its investment. This regulation lies on Business Reputation's own characters: it cannot be transferred independently, which provides a theoretical basis for its objectors;its intangibility makes evaluation difficult, which easily leads to over-evaluation, or false amount;its instable and fragile value threatens to capital's stability. All the above are adverse to the creditors and other shareholders for whose interest Company Law's regulation is to safeguard. However, according to this thesis, Company Law's regulation is not right. First, Business Reputation cannot be transferred independently, but it can be done together with the company, and it possesses the other three composing parts of substance, which can be invested. Secondly, over-evaluation of Business Reputation is not the necessary resultfrom legislation, but the accidental result that at great extent depends on the ability of evaluating personnel. Thirdly, it is the shareholder who decides which asset to be invested. As long as the investment is not prohibited by law, and as long as other shareholders are willing to accept, the investment is legitimate. Therefore, Company Law shall make an authorizing regulation on Business Reputation investment, authorizing the shareholders right to choose whether Business Reputation can be invested. Finally, Business Reputation investment is good for the realization of the valu^ of Company Law, i.e. capital efficiency, investment liberal, and transaction safety.Theoretically. Business Reputation investment gains its feasibility. However, is it maneuverable and how? Even if the company's capital regulation had adopted most liberal legislative attitude, if it were infeasible in practice, Business Reputation investment regulation would have been in vain. Therefore, this thesis puts forward some regulation design of how to practice Business Reputation investment in the end.