Theory Of Limited Liability Company Shareholders Oppression Problem

LLC occupy a very important role in our national economy,the other forms of economic organization can’t replace it. LLC pursue shareholders equality embodied in equal shares in essence, and "the majority of capital" principle arising from the base of equal shares make a majority of shareholders can oppress minority shareholders in different ways. so that minority shareholders can not exercise rights properly what shareholders should have.The harm of shareholder oppression to the minority is obvious. Minority shareholders may be deprived of decision-making on the company’s voice, minority shareholders may also be refused entry to the company’s door, a majority of shareholders may refuse to provide minority shareholders with the company’s daily management and major decision-making information, a majority of shareholders may also refuse to provide minority shareholders with the company’s financial information. The shareholders of LLC may be invest a large part of his personal property in the company, they usually look forward to or employed by the company as the company’s operating management positions. For them, the paid by working in the company and is often the main source of their income. In this case, once the minority shareholders were deprived of the opportunity to work in the company, his main source of income and livelihood will be lost. Under the condition of the minority shareholders is not working in the company, It is very important to the distribution of the dividend, and another way of oppression for majority shareholder to minority shareholders is refusing to allocate the company’s profits. In this case,minority shareholders expect a return by investing in reasonable expectation will be disappointed. The Worse, LLC lack of a public trade market as the listed company, it is difficult for minority shareholders to withdraw from the company by way of transfer of ownership. Ltd.The shareholders oppression behavior of LLC serious damage to the interests of minority shareholders and weakened the investor’s investment enthusiasm, disrupted the normal order of China’s economic development. So the LLC shareholder oppression issue is becoming urgent in the field of corporate law.However, China’s current corporate law is more concerned about the company’s deadlock handling, not give enough attention to shareholder oppression behavior. "Company Law" before the revision of 2005 almost did not reflect significant differences of LLC and listed companies in the governance structure. Revision of "Company Law" after 2005 took note of the Limited particularity, and strengthen the company’s autonomy, giving shareholders more power to choose the organization mode and operating behavior. The law allows shareholders to make the special arrangement of different legal regulations for profit allocation, the shareholders’ committee resolution method, the shareholders’ committee convened and voting procedures and so on, by the company’s articles of association and the shareholders agreement. At the same time, it also make the rules to the right to know of shareholders, claim to profit distribution.However, legal remedies provided of the company law in our country for LLC is not very perfect. For example, the oppressed shareholders only in case the company does not distribute profits for five consecutive years can exercise the right to request to buy shares. The referee dissolution system, especially in corporate law of many countries is mainly used for relief oppressed shareholders, but will only apply to the company deadlock in our country. Overall, the existing "Company Law" lack of strong and systematic acts of oppression shareholders regulatory measures. This is the main reasons that acts of oppression of LLC occur often in our current practice and has become a hot and difficult problem of the people’s court of the commercial trial.In this paper, chapter II, III, IV and Chapter V respectively lists a typical manifestation of oppression of shareholders phenomenon in our country, illustrates the problems existing in the current law of our country,cited the United States, Germany and Japan and other countries related legal regulations.h Puting forward the perfect our country shareholder pressure relief system by improving the means of relief system.In short, oppression of shareholders is both the core of the management problems and the core legal issues. Do a systematic and comprehensive study to it can enhance the level of our theoretical research, improving the governance structure and legal system, protecting minority shareholders’ s legal rights in the company.