Study On The Legal Path To Break The Corporate Deadlock

Company deadlock is due to one or more shareholders or directors faction holdopposite opinions concerning major policy decisions for the company, the board ofshareholders, the board of directors and management mechanism could not makeeffective management decisions, resulting in stagnant of company activities. Thecontinued company deadlock situation will cause damage to the interests of thecompany itself, the shareholders and the third party, even cause the waste of socialresources. Therefore, to search for relief ways to company deadlock had been arealistic problem in the study of the company law. The article set corporate deadlockand its settlement mechanism as the research object, combined with the main judicialpractice in Anglo-American law system and continental law system countries, throughthe comparison and analysis, elaborates on the concept of corporate deadlock,standards to determine whether a company deadlock starts, the involved in standardsand way for handling corporate deadlock disputes in foreign legislation and judicialpractice, the existing remedies in our country and the existing defects and the part thatcan be improved.The first part of this article explains the basic concepts of corporate deadlockfirstly, including the concept, the classification of corporate deadlock, and its reasonsand occasions. It mainly expounds that in strict sense the company deadlock should be changed to the shareholders’ committee, the persistent exist will cause harm to thecompany and its shareholders. The fundamental reason of corporate deadlock is theloss of characters based on shareholders. At the same time, the diversity of theinterests of the shareholders, the doctrine of the majority and capital maintenance arealso the reasons of corporate deadlock. Finally, company deadlock is always found inclosed corporations, this is due to the nature of closed companies. Through theintroduction of this part, the readers can have a comprehensive understanding ofcompany deadlock.The second part of the article introduces the measure to solve the corporatedeadlock disputes in legislation and judicial practice, including preventive measuresin advance and afterwards relief measures. The former one mainly arranged in thearticles of association, the latter involves the limits and degree of problem of publicpower intervention in the field of private law. There are different points of view indifferent period. At present, limited intervention is the mainstream view, and it affectsthe relevant legislation. This article combines the different theory and legislation ofAnglo-American law system and continental legal system, and expounds in detailabout it. Through the introduction, the readers can have a more comprehensiveunderstanding about the way to solve company deadlock and its advantages anddisadvantages.The third part of this paper elaborates the legislative evolution of the pathchoice to break the company deadlock in our country. It firstly reviewed thelegislative attitude and judicial practice before the revision of the company law, andsecondly introduces the attitude evolution about judicial practice to intervention ofcompany deadlock, which is from declined to limited intervention. This part finallyintroduces the relevant regulations about the new corporation law. Through theintroduction, readers can have more intuitive understanding about the legislative andjudicial attitude to corporate deadlock in our country.The fourth part of the article, on the basis of the above three parts, focus on thearticle183of company law and the relevant provisions of supreme people’s court onissues of company law of the People’s Republic of China, emphasis on standards and administration route to determine whether a company fall into deadlock in our country,and points out the gaps and deficiencies, and puts forward some correspondingperfecting suggestion. in order to give some reference for legislators.