On The Restriction Of The Limited Liability Company's Articles Of Association On The Transfer Of Stock Rights

In the company's legal practice,dispute cases are mostly concentrated on equity transfer.As far as equity transfer is concerned,joint stock companies generally adopt the principle of “generally free and exceptionally limited”.Limited liability companies often adopt the position of “principle limit,exception freedom”,so the dispute of equity transfer of limited company has become a prominent company practical issue.The legal provisions on the transfer of shares of the company are mainly concentrated from Articles 71 to 75 of the Company Law of the People's Republic of China,of which Article 71 is a general provision.Article 71,paragraph 4 of the Company Law of the People's Republic of China stipulates that: “If the articles of association of the company have other provisions on equity transfer,it shall be followed.” Can we interpret it as that any provision of the company's articles of association regarding the transfer of equity has legality? If the company's articles of association could prohibit the transfer of equity or the requirement of mandatory equity transfer? What's the explanation for the validity of the terms and conditions of the company's articles of association in the legal transfer procedure,like changing the time of equity transfer,voting rules? It can be seen that there's still some ambiguity in the expression “other regulations” and “from its provisions”,which triggers a large number of company disputes,due to different understandings in practice.But the understanding of this provision almost determines the legal effect of the company's articles of association restricting the equity transfer clause.The legal effect,even the difference in detail,can lead to very different and even diametrically opposite results in practice.In the equity transfer of a limited company,the vast majority of controversies or disputes are concentrated on external transfers.Therefore,based on the legal principle of the charter of the limited company imposing restrictions on equity transfer,this article analyzes the purpose and significance of the company's charter to restrict the transfer of equity,grasps the legality of the company's humanity as the basis for restricting the transfer of equity,and upholds the principle of "differentiation" to understand "other provisions" in Article 71,paragraph 4 of the Company Law.Simultaneously,the main content of the article focuses on the effectiveness of the specific restrictions in the charter and the impact of the restrictions on equity transfer.Then it classifies the effectiveness of the transfer clause,the mandatory transfer clause,the restriction of the transferee,and the specific agreement clauses which have restrictions on the transfer method or price.On the basis of the effectiveness of the equity transfer,and on the basis of distinguishing the impact of the regulation restrictions on the equity transfer agreement and the equity change,the author tries to innovate,and strives to find ways to achieve the transfer of the transferee's purpose and to remedy the legitimate rights and interests of other shareholders.In addition,this paper will also summarize the criteria for judging the validity of the corresponding restrictions in the Bylaws.On the one hand,the court shall conduct a legality test based on the nature of the autonomy law of the charter,that is,whether the corresponding provisions of the charter are in conflict with laws,administrative regulations or relevant basic legal principles,do not easily deny the validity of the charter unless it is necessary to confirm the corresponding articles of the charter as unlawful.On the other hand,it shall be further tested according to the reasonableness standard after confirmed it's validity,whether the restrictive provisions actually undermine the liquidity of the stock and if it harms the interests of the small and medium shareholders in an unreasonable way.This article will try best to sort out the effectiveness and impact of the restrictions of the company's articles of association on the transfer of equity,in order to provide a certain reference for the company's law practice.