Research On The Disregard Of Corporate Personality Mechanics In China

Separate entity and Limited liability of shareholders are the most core of the concept of Corporation Law,but also to build the two major cornerstones of modern company,which the combination makes the investors of modern corporate have been able to contain the risk of their own at an affordable range,inspired the people investment enthusiasm,and consolidated the confidence of the investment,then had played an enormous role in pushing forward human civilization and commercial development,the accumulation of wealth in society.However,with the commercial society development,people gradually paid more attention to the malicious shareholders take advantage the separate entity of corporation and limited liability of shareholders to wanton against creditors and minority shareholders,therefore,we created disregard of corporate entity.Disregard of corporate entity is the rule of prejudication that has been developed from the judicial practice of English countries. Later,this system has been accepted by the judicial practice of civil law system countries,and improving.Before the Corporation Law was revised in 2005,even though the theory of disregard of corporate entity appeared in some administrative regulations and judicial interpretations more or less,and be supported by court in some cases,but because of the lack of high-order Formulate laws to guide, inevitably result in the application of the confusion and inconsistency on.With the new Corporation Law declared the disregard of corporate entity established in 2005, we seem to see some hope for solving some long-standing problem of the construction market economy.But we all know,leading to a system of practice from theory has required a long way to go,moreover,our country in this regard is still in the initial stage The purpose of the writing of this paper is also hoped that do some inductions and some exploration in the process of putting the system of disregard of corporate entity to the practiceI hope this paper is not only a discussion about a theory of disregard of corporate personality,but also it can contribute some useful things for people who want to use this system.Disregard of corporate personality is based on that for the company's shareholders,the company's independent personality and limited liability of shareholders is a system to protect the interests of the shareholders.Shareholders once the company has chosen to engage in this form of economic activity,it is necessary to accept the character as an independent body for all the consequences,and should not time for personal interests or the interests of shareholders and to the court that the company does not have an independent personality.This paper is divided into three parts.In the chapter one,we would discuss the difficulties of disregard of corporate entity in theory and practice.Specifically from the following aspects:First,in theory disregard of corporate entity was worried that shake the modern corporate system.Second,Reality and theory update so fast. Third,China's economic structural reform left some problems.Forth,there are some problems in research methods on this question.Fifth,China's overall quality of judges is not sufficient to satisfy the practical implementation of this system.In the chapter two,Disregard of corporate personality corporate system as a useful complement system.If you do not correctly applied,will cause the consequences of instability in the entire legal system,also runs counter to the creation of corporate personality system was originally denied the meaning of.Main purpose of this section is what situation could be determined to be applicable disregard of corporate entity and into our country in this regard the existing normative legal documents in order to find a path to practice from the theory.In this paper,we use three elements of theory to summarize the application of conditions.In subject condition,it is divided into elements of the rights and obligations of the subject to be discussed;in the behavior condition part,this paper outlines the six major categories of behavior.First,the company obvious doesn't have adequate capital.Second, shareholders don't follow corporate formalities.Third,shareholders have fraud or wrongdoing.Forth,there are a high degree of confusion between shareholders and corporation.Fifth,somebody artificially put a single business entity into division. Sixth,disregard of corporate entity conditions happened in mother-son corporations. In this paper,the core of result conditions,can be summed up as requiring a shareholder had some misconduct behaviors and caused very serious loss to the creditor,and there is a direct causal relationship between shareholders' misconduct behaviors and creditor's losses,and such losses can not through the corporation's compensation to make up their own.At the latter part of this chapter,writer Summed up and summarized great amount legal provisions about disregard of corporate entity, in addition,in this paper,also make a simple discussion about some questions that the laws of our country have not yet to order.At present,the theoretical circles already have enough discussion about major shareholders abuse limited liability of companies to avoid legal liability.Moreover, according to the theory of Chapter two of this paper can be found a way to solve this problem.But In reality we don't pay sufficient attention to the condition that more than one shareholder abuse limited liability of companies to against creditors and minority shareholders.Therefore,in the chapter three,this paper,based on some real cases in order to facilitate discussion,we assume there is a company limited, which constituted with shareholder of state-owned assets and shareholders of private capital,but nobody is controlling shareholder.All shareholders did some misconduct behaviors to against minority shareholders and creditors.Based on our existing laws, the following situations will be very difficult to deal with us.First of all,once the corporate veil was pierced,government would be facing a difficult situation;of course,it is contrary to the original intention of legislators.Secondly,existing law does not formulate the burden of proof in such cases,thence,if the plaintiff want to disregard of corporate entity will be very difficult.Third,the shareholders how to take a responsibility for their wrongdoing? For the above-mentioned problems,I think, first of all,for Shareholders for the state-owned assets,on the one hand,we should weaken the power of it,on the other hand,we should let it is no longer responsible for the situation of disregard of corporate entity.I believe that fault shareholders should together with the company take jointly and severally liable for the debt, however,the premise is to determine the fault of shareholders enough to cause harm,which could affect the company's ability to repay debt.