Research On The Japanese Independent Directors’ Limitation And Exemption Liability System

At mid-eighties, American company legislation has already provided detailed system to limit civil liability of directors, but at that time directors has not been divided into different categories. In 2002, Enron event greatly prompted the development of limit liability system of independent directors, and it also attracted the world attention on limit liability system of independent directors. Japan is one of the countries which has been greatly affected by that. In 2002, Japan modified the "Japanese Commercial Code" and "Japanese Company Law" for the first time, one of the highlights of the modification is the introduction of American independent director system. The legislation of "Japanese Commercial Code"(2002) and "Japanese Company Law"(2005) on limit liability system of independent directors, particularly provisions on the limitation and exemption liability of independent directors caused great attention. Since Japanese limitation and exemption liability system of independent directors is reasonable and workable, it has been well implemented all the time. In contrast, there is no clear classification on the regulations of independent directors system introduced by China, and many of the provisions is not clear and specific which leads to difficult implementation in practice. Therefore, this paper attempts to analyze the deficiencies of presence independent directors’ liability system, and make reasonable suggestions on improving the liability system of independent director by adsorbing the strengths of the Japanese practice.This paper is divided into four chapters. The first chapter describes the background of the generation of Japanese independent directors’ limit liability and and make comparison between Japanese independent directors’ limitation and exemption liability and that of American. The second chapter explains specific provisions of Japanese regulations on independent directors’ limitation and exemption liability system, including the applicable objects and conditions, minimum amount, applicable procedures and points for attention, and illustrating positive affection of Japanese independent directors’ limitation and exemption liability system. The third chapter describes the way how to improve and perfect Chinese independent directors’ limitation and exemption liability system. Firstly the author expounds China’s laws and regulations relating to independent directors’ limitation and exemption liability system, then the author gives recommendations of improvement on the independent directors’ limitation and exemption liability system based on analyses of problems existed in the relevant legal system in practice. Finally the author elaborates related system of independent directors’ liability. At the end of the paper, the author discusses further improvement and development of China’s independent directors’ liability system.