Research On The System Of Shareholder’s Expulsion Of The Limited Liability Company

Because of personal nature, shareholder’s trust and cooperation is very importantto the development of the limited liability company. But due to the innate closednature, conflicts among shareholders is inevitable. How to solve the contradictioneffectively is hard for various countries, especially if one of the shareholdersundermines each other’s confidence, damages company’s interests, and causes thecompany’s deadlock. There are some reliefs for shareholders in the Company Law ofPeople’s Republic of China, such as shares transferring system, the withdrawingmechanism for shareholders, and the system of judicial dissolution. However, sharetransfer and withdrawing mechanism means that the shareholder has to leave hispainstakingly built company. It’s a nothing-could-do solution. Judicial dissolutionmeans the company is not existing any more. It damages not only the shareholders butalso the company. All the above solutions will cause damages to shareholder in goodfaith, the company and the whole society. The system of shareholder’s expulsionprovides a economic and efficient solution to this contradiction. It has incomparablesuperiorities. The system of shareholder’s expulsion directly defines the relationshipbetween the shareholders. To expel a shareholder who undermines the company fromthe company and deprive him/her the shareholder’s qualifications pursuant to legalprocedures is good to solve the trust crisis in the shareholders, to enhance the basis oforganized business management, and to safeguard the benefits to the largest extent of the leave-behind shareholders and the company.This paper has a systematic analysis on the system of shareholder’s expulsion.Besides introduction and conclusion, this paper can be divided into three parts:Chapter One, theoretic analysis on the system of shareholder’s expulsion of thelimited liability company. This part argues the reasonableness of the system ofshareholder’s expulsion. Firstly, the nature of the system is to deprive theshareholder’s qualification, which is concerned with the nature of shares. Secondly,the theoretic foundation in civil law and commercial law provide theoretic support forthe system of shareholder’s expulsion.Chapter Two, experimental analysis on the system of shareholder’s expulsion.This part argue the necessity of the system of shareholder’s expulsion from theexperimental perspective. The system of shareholder’s expulsion is in urgency in thejudicial practice. However, the Company Law fails to give some regulations, and theThird Judicial Interpretations of Company Law defines not perfectly. Besides, thispart introduces the stipulations on the system of shareholder’s expulsion in Germany,Portugal and Macau.Chapter Three, the establishment of the system of shareholder’s expulsion of thelimited liability company in China. To perfect the system by legislation, theestablishment of the system of shareholder’s expulsion shall firstly follow some basicprinciples, secondly stipulate detail substantive and procedural factors, and lastlysafeguard the benefits of the expelled shareholder and of the creditors.