On Articles Of Association Legal Effect

In the operation of corporations, the corporate charter is playing a role of skeleton, and is also called "Constitution of corporation". Constitution of corporation, as the name implies, means that in addition to the Company Law, the corporate charter possess the supreme validity to guide the development of corporations and to restrict the actions of corporations as well as the related personnel.Although the corporate charter is so important, it has not been widely acknowledged. If we really want to draft a suitable charter for the development of individual corporation, we should understand the legal validity of the corporate charter completely and systematically. Therefore, this thesis analyses the legal validity of the corporate charter systematically with four parts by the hermeneutic method.Part I carries out a basic dissertation about the legal validity of the corporate charter, which says from the legal validity that basing on the authorization of Company Law and the acceptability of the constitutor of the charters, the legal validity of the corporate charter possesses the forcible sanction in time, space as well as its objects. The legal validity of the corporate charter roots from contracts, organizing principles and Company Law, which is composed of subject elements, formal elements, the procedural elements and content elements. Grounding on the above dissertation, this part sets the stage for the following analyse of the legal validity of the corporate charter.Part II discusses the range of the legal validity of the corporate charter, which says that the legal validity starts from the constitution of the charter before the registration of the corporation and ends in the write-off of the corporate. The corporate charter has the both internal and external validity. The internal validity includes the legal validity on companies, shareholders, boards of directors, board of supervisors and senior management, and the external validity includes the public validity and public faith on the third party and the public. Part III analyzes the impact of the legal validity of the corporate charter when the charters are defective and modified, dividing the reasons of the defects appearance into procedural ones and substantive ones and explaining the legal results and the solving methods after the appearance. For the defects appearance, it is believed that the corporate charter is still valid after the defects are modified by the means of shareholders' meeting or litigation, etc. And for the modification of the charters, this part analyses that the reasons of modification are because of the defects, the situation of the corporations or the adaption to the modified laws and regulations, defining that the charters should base on the validity of main part modification, content modification and modifying procedure, without prejudice to the interests of shareholders as well as the interests of third party. And the modified corporate charter will be effective through proposal, shareholders' meeting, consideration, and registration etc.Part IV compares the legal validity of the corporate charter with some kinds of laws that may have confliction to the charters, which believe that the corporate charter could be prior to the arbitrary norms of Company Law except the forcible norms. And compared with sponsor agreement and Shareholders resolution, the corporate charter has the higher legal validity.In conclusion, the corporate charter is so important in the structure of the system of Company Law that it is playing a key role to affect the corporations from beginning to end. The corporate charter is the basis of the construction of the corporation as well as the soul of their existence, which should obtain the public concern, so that to fully reflect the legal validity of the corporate charter.