A Study On The Appraisal Remedy For The Dissenters

The modern countries Companies Act commonly used "capital principle ofmajority voting to decide important matters of the company in the production andmanagement. This system will not only enhance the company’s operating efficiency,and help the company make relatively correct decisions in a short period of time, butalso reflects the shareholders in accordance with the shares held by him have animpact on the company’s business, but also reflects the democratic decision-making,capital of the idea of equality. However, the more the proportion of shares as a%ofthe company’s largest shareholder master, will be able to easily control thecompany’s future business decisions, to smooth their own ideas into the company’sfuture course of action; Shares represent the hands of minority shareholders the lowproportion of the company’s looser unable to form a cohesive force, is not satisfiedwith its foreign business decisions for the company, not by the shareholders will voteto reasonably express their demands. This led to the largest shareholder of thecompany violated the interests of minority shareholders in the event have occurred.Dissentient shareholder appraisal rights under this situation emerged. The mainpurpose of the system was established that the dissenting shareholders on thecompany’s major decisions of minority shareholders (in most cases) for relief efforts.China’s October27,2005issued by the Company Law for the first time defined the appraisal rights of dissenting shareholders, this is a big step forward on thelegislation of the Law in China, provides a clear legal protection of the rights ofdissenting shareholders basis. Conform to the trend of modern company law isfocused on protecting the interests of minority shareholders, and guaranteed thebalance of interests of different shareholder groups. The shares of the dissentingshareholder appraisal rights system is a win-win system, it is not only the companydecision to exclude a small number of dissenting shareholders interference passed,so that the shareholders of the Company will maintain a relatively unified views ofthe future development, conducive to the unity of the company, but also gives thedissenting shareholders to exit the company’s power to obtain fair and reasonablecompensation.Our law provides for the a dissentient shareholder appraisal rights system, butthe system of the provisions in the Companies Act which is too brief, just a matter ofprinciple, to be provided, and there is no corresponding implementation details, inpractice, the lack of operability. Specific performance: First, do not make clearprovisions on how to assess the value of the shares of the dissenting shareholders,but only generalities "reasonable price", as to what is "reasonable price", how todetermine the "reasonable price" who will determine the "reasonable price" none ofthe provisions can not play the role of the system. Not the procedures for theexercise of that right to make specific provisions to the specific implementation ofthe system cause difficulties. The purpose of writing this paper is to rationalize theemergence and development of the ins and outs of the shares of the dissentingshareholder appraisal rights, analysis of the causes of its theoretical basis of thesystem, by comparing the system sound national company law legislation to makerecommendations for future modification and improvement of the Companies Act.