Study On Legal System Of Recourse Relating To Company’s Creditors To Shareholders In China

Recourse relating to company’s creditors to shareholders occurs in some legal circumstances in China. These circumstances not only comply with the legislative purpose regulated in Article 1 which protects the right of company’s creditors in Company Law of China, but also play a positive role in regulating shareholders’ behavior and guarantee the effective function in company’s legal system. Currently, the legal study on recourse relating to company’s creditors to shareholders always focuses on just one or a kind of legal situation. Thus, this paper attempts to summarize all these circumstances of recourse relating to company’s creditors to shareholders and explore a rational system, which shows a detailed discussion and in-depth analysis about recourse relating to company’s creditors to shareholders in China.This paper includes three parts, Introduction, Text and Conclusion, and the Text part is subdivided into five chapters.The Introduction part generally discusses the topic, the meaning of research, commentary of documents, the thinking of writing and the methods of study.The first chapter indicates that legal situations about the recourse relating to company’s creditors to shareholders are different. However, to some extent, these situations of recourse could be divided into “direct recourse” and “indirect recourse” in a certain standard. Moreover, this classification is considered as a major opinion and an important foundation in this paper.The second chapter mainly discusses a legal basis about the recourse relating to company’s creditors to shareholders. Actually, it is very necessary to find some strong supports because these situations relating to recourse are exceptions. In view of the principles of Company Law, the value of Commercial Law and some other basic legal principles and theories, the recourse relating to company’s creditors to shareholders includes the three aspects as below, inhibiting behavior of shareholders abusing corporate personality, maintaining security of market transaction, and following principle of “a right without remedy is not right”. Firstly, corporate personality is a significant principle in Company Law. So it is necessary to inhibit behavior of shareholders abusing corporate personality by the way of the resource relating to company’s creditors to shareholders, which could contribute to maintain the effective operation of the principle. Secondly, efficiency and safety are values of Commercial Law. Because the recourse relating to company creditors to shareholders satisfies the value of safety and can maintain security of market transaction, this resource is worthwhile. Finally, the “a right without remedy is not right” indicates that if a right can get an effective remedy, it is a right. Accordingly, when the way of company creditors requiring company to take responsibility is useless, the way of the resource relating to company’s creditors to shareholders should be allowed.The third chapter focuses on the necessity of strengthening the recourse relating to company’s creditors to shareholders on the realistic basis. On December 2013, the company capital system in China has been revised. This reform conforms to keep pace with the times, but brings some disadvantages to company’s creditors. At least, in the transition period, company’s creditors have to bear several unreasonable risks and apparent imbalances between themselves and shareholders. Therefore, it is indispensible to strengthen the recourse relating to company’s creditors to shareholders in such kind of the background.The forth part emphasizes on discussing Articles involving the recourse relating to company’s creditors to shareholders in Company Law of China, which is based on the system of “direct recourse” and “indirect recourse” and is divided into three steps. Firstly, each involved article is carefully analyzed. Secondly, all these articles are compared with each other in order to find the differences and commons among themselves. Thirdly, a few defects or contradictions of these articles are deeply discussed, including the laws and regulations themselves, the conflicts between the laws and regulations, along with the contradiction with the other laws and regulations.The last chapter tries to arise some feasible suggestions on the above mentioned deficient provisions, which could make some contributions to the development of legal system of recourse relating to company’s creditors to shareholders in China.The Conclusion part summarizes the paper, including the author’s opinions, innovations and feelings.