Research On Legal Issues Of Shareholding In China’s Limited Liability Companies

In the process of the rapid development of China’s socialist market economy,equity entrustment,as a new type of investment,has been favored by more and more investors.The mode of equity entrustment mainly exists between the actual investor and the nominal shareholder,the actual investor is also known as the hidden shareholder.On the one hand,equity entrustment meets the objective needs of the company’s development,on the other hand,it also brings some risks.For their own interests,some individuals take advantage of the loopholes in the equity entrust law,and eventually damage the interests of the company,other shareholders and the company’s creditors.In view of this,all countries in the world are through the specification of different forms of company legislation,the current "company law" is lack of clear regulation in our country,the problem is involved in the company law to explain three,in November 2019,the Supreme People’s Court promulgated by the national work conference on court in civil and commercial trial summary has been clear about the actual investor name condition regulation.It is still difficult to adapt to the needs of judicial practice.Therefore,the equity entrustment of limited liability company is still an important legal problem to be studied urgently in China.This paper uses normative analysis,comparative analysis,empirical analysis,literature research and other methods to study the legal issues of stock ownership in China.In addition to the introduction and conclusion,this paper mainly includes the following four parts:The first part is the basic overview of equity entrustment.This part mainly analyzes the conceptual problems of equity entrustment.Firstly,the concept and characteristics of equity entrustment are summarized.Secondly,the formation reasons and behavior types of equity entrustment are discussed.Finally,it introduces the legal risks and the significance of equity entrustment.The second part is the legislation status quo and existing problems of equity entrustment behavior in China.This part first analyzes the legislative status quo of equity entrustment,mainly focusing on the Company Law,Foreign Investment Law and other relevant provisions of the theoretical analysis;Secondly,it demonstrates the more prominent controversial focus in judicial practice.Finally,it summarizes the problems existing in legislation and events of equity entrustment.Such as;The legal nature of equity entrustment is unclear,the legal consequences after the equity entrustment agreement is invalid are not clear,it is difficult to safeguard the rights of hidden shareholders,and the protection of creditor’s rights is insufficient.The third part is the comparison and reference of foreign equity entrustment system.This paper focuses on the design and judicial application of the equity entrustment system in the United States of common law system and Germany of civil law system.After the comparison and analysis,it sums up the experience that is worth using for reference in China’s equity entrust system.The fourth part is the core content of the paper,which is the suggestion of perfecting the legal regulation of equity entrustment in China.This part includes four aspects.First,clarify the legal nature of equity entrustment.In this paper,the author thinks that equity entrustment is a contractual relationship.Second,make clear the criterion of the validity of equity entrustment agreement.For example,to agree on the liability for breach of contract,strengthen the management of investment certificate,and construct the notary system of equity entrust agreement.Third,strengthen the protection of the rights of hidden shareholders.Such as the implementation of the dual-track system.Fourth,improve the mechanism for protecting creditors’ rights and interests.For example,standardizing the shareholders’ investment behavior,setting up the disclosure system,and establishing the legal basis rules for compulsory equity execution...