Study Of China's State-owned Enterprises Management Buy Legal Issues

Since the concept of management boy-out (MBO) put forward in 1980s, MBO has been widely recognized and applied in the western world. The application of MBO can help to combine the interests of both management and corporation together and stimulate the management team to improve the performance of the corporation.At present, China is experiencing a transforming period economically. The government has changed the management to macro manipulation, thus the national economy naturally goes through a strategic transformation and the state-owned enterprises (SOEs) will recede out of the competing industries gradually. Besides, the equity issue of the SOEs is still very serious and compensation mechanism is far from perfect inside those corporations, which further affect the healthy development of the national economy and competence of specific corporations. At the end of 1990s, Chinese scholars started to focus and research on MBO and there is a fever of MBO comes along with. But whether the corporate management model is really fit for the Chinese market? Whether MBO can be really helpful for the economic development? Are there any issues the SOEs should pay close attention? How to overhaul the legal system to accommodate the MBO in China? There add up to four chapters in this paper. The first is a brief introduction of the MBO in terms of notion, characteristics and historical development, which lays a foundation for the following paragraphs. The second chapter makes a theoretical and practical analysis on the MBO practices and discusses the status quo, significance and side effects of MBO in China. The third chapter makes an analysis on MBO from a legal perspective, which further analyze the legal relation and legal consequences of MBO. The fourth chapter puts forwards legal obstacles for the MBO under the current legal system and gives corresponding suggestions.