Research On Repurchase Rights For Dissent Shareholders In Listed Companies In M&A

Repurchase Right for Dissent Shareholders refers to the right that a minority shareholder has to request the company to repurchase its shares at a reasonable consideration when it disagrees with the resolutions made by the company's shareholders' meeting on certain matters(merger and acquisition transactions or other matters that lead to fundamental changes in the company).At present the "Company Law" implemented in China only explicitly stipulates the right of dissenting shareholders to repurchase shares in the case of limited liability companies and the way to settle related disputes.In the case of joint-stock limited companies,it just simply stipulates in principle the right of dissenting shareholders to repurchase shares in the case of merger or division by item 4,paragraph 1,article 142 of the "Company Law".Compared with the detailed legislative provisions in many foreign countries and regions such as the United States,Japan,South Korea,many European Union countries and Taiwan,China,China's legislation in this area is especially deficient and lagging behind.Judging from the mainstream viewpoints and relevant practical experiences in the academic circles of the United States and Japan in recent years,public companies in merger and acquisition transactions are the vast majority of the background for the litigation practice of dissenting shareholders' share repurchase claims.They have significant functions in supervising the fair conduct of merger and acquisition transactions and resisting the egoism of management,and are a powerful tool for controlling shareholders to steal rights from minority shareholders.Judging from the current situation of our country,the listed companies in our country's joint-stock limited companies are the most open.Now the market for mergers and acquisitions of listed companies in our country is warming up and mergers and acquisitions are frequent.A perfect system of dissenting shareholders' right to repurchase is necessary to protect the rights and interests of the minority shareholders in the upsurge of mergers and acquisitions.Legislators have made relevant regulations in the case of limited liability companies,however,there are still too narrow scope of application in the case of listed companies,and there are gaps in terms of exercise qualifications and procedural guarantees.The lack of regulation on how to determine the share repurchase price of dissenting shareholders,the lack of judicial intervention to determine the fairness of the share repurchase price of dissenting shareholders and other issues have avoided the contradictions existing in the practice of dissenting share repurchase of listed companies.Therefore,this paper hopes to study and design a system of dissenting shareholders' right to repurchase that is suitable for China's listed companies by referring to the practical experience of mainstream developed countries(regions),and to respond to the existing problems.This paper comprehensively uses normative research,value research,comparative research and other methods to discuss the problems existing in the practice of dissenting shareholders' repurchase claims of listed companies in our country,the necessity and legitimacy of constructing dissenting shareholders' repurchase claims of listed companies,and the specific content of constructing dissenting shareholders' repurchase claims of listed companies in our country.The first part of this article analyzes the regulations,application and existing problems of the system of dissenting shareholders' share repurchase claim in listed companies in China,and compares the cash option,pointing out that its essence lacks the protection connotation of dissenting shareholders' share repurchase claim and cannot replace dissenting shareholders' share repurchase claim.The second part further discusses the legitimacy of establishing the system of shareholders nominating directors by questioning the principle of market exception and discussing the function of dissenting shareholders' right to repurchase in merger and acquisition of listed companies.The third part is an investigation of the overseas mainstream legislation on the system of dissenting shareholders' right to repurchase shares,including the relevant regulations of the United States,Japan and Taiwan of China etc.,and an analysis of the system's reference and thinking on the establishment of the system of dissenting shareholders' right to repurchase shares in listed companies in mainland.The fourth part is the design of the system of the dissenting shareholders' right to repurchase in listed companies,including the discussion on the particularity of the construction,the specific system design and the supporting system.