| In 2016,the cases concerned with the cause of action "request the company to repurchase share" has increased significantly,the vast majority of cases are based on limited liability company as a defendant,and the most cases of share repurchase is beyond the Chinese Company Law.Besides,the judicial views are inconsistent with each other.To meet the demands of commercial society and fill the legal gaps,construction of a limited liability company share repurchase legal system is necessary.In order to build a balanced share repurchase mechanism between companies,creditors and shareholders,we need to investigate the pros and cons of share repurchase system of limited liability company and have a comparative study of the provisions of the United States,Japan,Germany,South Korea’s share repurchase regulations concerned with the legislative model,financial resources,repurchase procedures,etc.In the author’s opinion,the legislative model should be used on the principle of"permission legislation mode with additional restrictions”.The financial resources restrictions should limit to the after-tax profits.As to the repurchase procedures,taking into account the protection of the interests of small shareholders,the number of shares repurchase should be limited in the range of the total shares of 10%.The right to decide whether to repurchase,shall be submitted to the board of shareholders,but ifthe constitution authorize the board of directors to decide,the decision by the board of directors is still valid.The author proposes to accept the repurchased shares as the treasury shares,but the amount should limit to the 10% of the registered capital.At the same time,in order to prevent the abusement of shareholders’ rights in repurchasing shares,China should limit the company’s right to vote on its shares and the right to ask for earnings distribution.As to the legal liability of validity of the illegal repurchase,we should distinguish the illegalities,in violation of financial restrictions or decision procedures for illegal matters shall be judged as invalid.In addition,if the directors fail to comply with their obligations,they shall bear responsibility from compensation to serious fines or criminal responsibility. |
