The Funding Of Nullity System Of Company Establishment In China

Companies are the most important participants of the economic activities inbusiness society, so a good system to establish and operate a company is veryimportant for the sustained and stable development of the market economy. Thenullity system of company establishment is a system design regarding the originalcompany law system, which is obviously important to the development of theeconomic society.The company law system is a typical imported product into China, as the moderncompany law system is created and developed in western countries, and latertransplanted into the commercial law system of China. There are some differencesamong the provisions of company laws in various counties, but the fundamentalcompany theories are the same or similar; and their legislations and practices are allvaluable references. The common law counties admit the effectiveness of companyestablishment on principal, while the civil law countries provide the nullity systemand withdrawal system of company establishment pending on different circumstances.China belongs to the civil law system in essence, and planned to introduce the nullitysystem of company establishment several times during the process of developing lawsand regulations, but does not succeed in formal legal documents. Only the thirdjudicial explanation of company law provides the administrative withdrawal systemfor the nullity of the company establishment, which is very different from standardinternational practice. The author speculates that the use of foreign company lawreferences will inform the funding of the nullity system of company establishment in China.It is necessary to define relevant concepts and meanings before conductingresearch on a rule or system. The first chapter of this thesis defines the meaning ofnullity of company establishment, and conducts comparative analysis with other legalconcepts, which are related and can be easily confused. On the basis of the definedconcept, it analyzes the jurisprudential foundation from the perspectives of thecompany capital system, company establishment principal and legal value balance.The developed foreign legal systems are very important references for the systemdesign of nullity of company establishment in China. The second chapter of this thesislays out provisions relating to the circumstances of nullity of company establishment,then classifies and summarizes them after looking up company laws and regulationsof various countries. To understand the foreign law provisions and development statusof Chinese law, the author also organizes the provisions regarding nullity of companyestablishment during China’s legal evolution process.The third chapter discusses the confirmation methods and basic rules of lawsuitsregarding the nullity of company establishment, on the basis of the legal principalsand specific provisions of various countries. This mostly focuses on the confirmationcircumstances of lawsuits regarding the nullity of company establishment and thelegal effect of the void verdict, including the effects towards the company itself, theshareholder and other staff, and third parties, such as its creditors.Finally, in the last chapter, on the basis of foreign experiences and domesticnational conditions, the author proposes the idea of founding the nullity system ofcompany establishment in China, and suggests the circumstances and confirmationmethods of nullity of company establishment.