Corporate Credit On The Legal System In China

Company credit which is regarded as one of the principal parts of the market economics has received widespread attention. In China, the articles associated with company credit have been included in several laws, e.g., Company Law,Securities Law. However, discredit activities can not be prohibited, for example, default contract,default debt,artificial capital,faked or poor quality commodities in the market. The above-mentioned problems not only degrade belief of the investors, but also spoil the regulation of the market economics. In the present study, the adaptability and drawbacks of the available laws in China were analyzed in terms of the company capital law and the extraterritorial models about internal supervision. Subsequently, the preliminary suggestions on enhancing the related laws were proposed.Besides the parts Introduction and Conclusion, the dissertation consists of four chapters.In Chapter 1, the understanding of credit and company credit was summarized. Definition of company credit, which is determined to be the social evaluation on its ability to fulfill the duties, was fixed on the basis of the macrocosmic and microcosmic influence of the credit on the market economics. Later on, the academic understanding on characters of the company credit was expounded and analyzed, resulting in that the personality right is inherent in the company credit. Finally, the company credit was classified and discussed in terms of company prosecution, scope and targets of activities.In Chapter 2, the main contents associated with the company credit clauses discussed in the present study were introduced. The understanding and three types of company capital and company capital law was revealed. Subsequently, the relation between company capital law and company credit was then analyzed. Finally, the association between the company supervision department and company credit was discussed in terms of the physical meaning of the company supervision department, the related clauses and three modules.In Chapter 3, the available company credit clauses in China are summarized and evaluated. In a whole, the clauses related to company credit tend to be enhanced; as well, the revisions to the company credit clauses are more targeted. However, definition of credit is not exactly explicit, and the credit investigation legislation is still not complete. As for the company capital system in China, the eclectic authorized capital system has been determined. The regulation on the capital maintenance is more liberal. The one-man company system and the disregard system of corporate personality are introduced in the capital system. Although the available company capital system tends to be liberal, some drawbacks are still located in the systems related to investigation methods, reinvestment methods and disregard of corporate personality. As an example of the extraterritorial models about internal supervision, although parallel existence of board of supervisors and independent director is available, drawbacks associated with the board of supervisors and independent director system were pinpointed in independence, company information capture, limitation and inspiration system, and liberality division.In Chapter 4, the main attention was placed on the author's suggestions on enhancing the company credit law in China. On the basis of the drawbacks of the available clauses mentioned in Chapter 3, the authors shown that limitation on the regulation of reinvestment is a necessity and the adaptability condition of using disregard system of corporate personality should be detailed. As well, further enhancements on the regulation on the board of supervisors and the independent director and on their relation should be fulfilled. The author suggested establishment of the system of credit and explicit definition of the credit and credit right in the Law; the violation to the credit right should be called to liability. The punishment on the discredit activities should be intensified, and the obstacle and sanction should be given to the company with discredit activities. Credit regulation should be propagandized in a view to increase credit mind of the company and fulfill the internal supervision system of company credit; In order to speed up the development of the letters drafting organizations, legislation on letters drafting organization are suggested to step out by establishing the related criteria on credit investigation activities.