The Interpretation And Application Of "Prohibition Of Abuse Of Shareholders’ Rights"

The article on Prohibition of abuse of shareholders’ rights consists of the first half of the first paragraph and the second paragraph of Article 20 of the company law.Based on the legislative text,this paper intends to form a logical and complete explanation of the interpretation and application of the clause by integrating theories,cases and comparative law experience.The paper consists of six parts: introduction,chapter1 to 4,and epilogue.Among them,the introduction puts forward four organic connected research issues,which constitute the research topics of the first to the fourth chapters respectively.The epilogue summarizes the main research innovations scattered in different chapters.The core content of the introduction is to construct research questions.Literature review and case statistics show that there are different views and judgment standards on the interpretation and application of the “Prohibition of abuse of equity clause”about the legislative structure of the clause,the identification of “abuse of shareholders’ rights”,the composition of tort liability of “abuse of shareholders’ rights”,and the relief function of the clause in theory and practice.This not only hinders the development of the theory of “abuse of shareholders’ rights”,but also seriously damages the uniform application of law and judicial justice.Focusing on the above four controversial aspects,this study is committed to solving the following four problems:(1)how to understand the legislative construction of “Prohibition of equity abuse clause”;(2)how to establish the identification standard of “abuse of shareholders’ rights”;(3)how to construct the constituent elements of tort liability of“abuse of shareholders’ rights”;(4)how to understand the legal effect of “Prohibition of equity abuse clause”?The first chapter discusses the legislative construction of “Prohibition of equity abuse clause”.The research shows that the “Prohibition of abuse of equity clause” is the specific application of the principle of prohibition of abuse of rights in the company law,which presupposes the structural relationship between “company vs.shareholders” and “shareholders vs.shareholders”,and its purpose is to protect the interests of the company or shareholders.The theory of fiduciary duty does not conform to the legislative purpose and legal system interpretation of the clause,so it is difficult to become its legal basis.In order to achieve the purpose of legislation,“shareholders” should be expanded to include dormant shareholders and shareholders with the identity of director,supervisor and senior manager,and should be applied to the actual controller.The distinction between the interests of the company and shareholders is an important practical problem,but there is little research on it.Through the comparative analysis of cases,this paper puts forward the distinguishing standard of “priority test of corporate interests”.For the dispute of shareholders’ infringement on the company or shareholders’ interests,we should first judge whether the company’s interests have been damaged,that is,whether the litigation interests can belong to the company;secondly,if the litigation interests cannot belong to the company,we should consider that the shareholders’ interests have been damaged.The second chapter is to identify the “abuse of shareholders’ rights”.How to identify it is the key to explain and apply the “Prohibition of equity abuse clause”.On this issue,there are different arguments between the theory of behavior and the theory of elements in the research path.The theory of elements confuses the difference between the legal concept of “abuse of shareholders’ rights” and the legal provisions of “Prohibition of abuse of equity”.So,this paper chooses the path of behavior theory to discuss the identification of “abusing shareholders’ rights” from the perspective of behavior characteristics.Based on the legislative text,theory and practical judgment,“abuse of shareholders’ rights” should be identified with “shareholders’ behavior is illegal and infringes on the company or shareholders’ interests” as the form identification standard,and “shareholders’ behavior is not illegal but unfairly infringes on the company or shareholders’ interests” as the substantive identification standard.Case typology and comparative analysis show that the “unfair infringement”of substantive standard can be judged by reasonable expectation standard and fair investment-income standard in specific cases.According to the standard of reasonable expectation,“unfair infringement” means that it violates reasonable expectation and cannot provide reasonable reasons;according to the standard of investment-income fairness,“unfair infringement” means that the investment of the same unit cannot get the same income.Substantive standard overcomes the limitation of formal standard and is helpful to maintain substantive fairness.The two standards break through the presupposition of the prior right in the theory of right abuse,and extend the scope of“abuse of shareholders’ rights” from the exercise of equity to the behavior of general shareholders.The expansion of the scope of action not only respects and maintains the common practice in practice,but also helps to play the role of protecting shareholders from abusing their rights.The third chapter discusses the constituent elements of tort liability for “abuse of shareholders’ rights”.On this issue,there are different arguments between three elements,four elements and so on in theory and practice,which results from the lack of consensus on the nature of responsibility,imputation principle and fault identification.From the perspective of system interpretation,theory and legal interest protection,the liability should belong to special tort in nature,fault presumption should be applied in the principle of imputation,and there are two forms of intent and negligence in the determination of fault.After the above issues have been clarified,the tort liability of “abuse of shareholders’ rights” is constructed according to the three-tier structure,that is,it is composed of factual elements(shareholders’ behavior,interest damage and causality),illegality(illegal violation and unfair infringement)and imputation principle(presumption of fault liability).The separation of factual elements and illegality helps to understand the difference between “abuse of shareholders’ rights” and its tort liability.In the application of law,the judgment of constitutive requirements should follow the logical order of factual requirements first,then illegality,and finally imputation principle.The theme of “chapter four” is the legal effect of “Prohibition of equity abuse clause”.The first half of paragraph 1 and paragraph 2 have relatively independent legal status and application space.As for the relief function of the first half of paragraph 1,the key issue to be studied is the determination of its normative attribute,that is,the mandatory provisions of effectiveness or the mandatory provisions of management.In this regard,there are few theoretical studies and the standards of judicial adjudication are not unified.From the perspective of promoting judicial justice and the integration of the legal system,the first half of the first paragraph should be regarded as a compulsory provision of effectiveness.Legal acts,contracts and resolutions of the shareholders’ meeting will be invalid due to violation of the provisions of the clause.In this way,the clause itself becomes the legal basis for denying the behavior of “abuse of shareholders’ rights”,so as to give full play to the role of “defense in advance”.As for the relief function of the second paragraph,the legislative text stipulates the method of “damage compensation”.This single way of relief has become the object of criticism in academic circles.Some theorists believe that the diversified remedies by the judiciary have compensated the lack of legislation to some extent.The paper’s empirical statistics show that although the judicial relief method is more flexible,it does not exceed the scope of “damage compensation”.The practical judgment has not broken through the meaning of the legislative text and the main function of the clause is to provide ex post relief through “damage compensation”.On the whole,the rule of prohibiting the abuse of shares not only has the function of equity and supplement,but also plays the role of basic norms in the whole civil and commercial law system.The epilogue reflects on the innovation and deficiency of the whole paper.The innovation of the research consists of putting forward the standard of distinguishing the interests of the company from those of the shareholders,putting forward the standard of reasonable expectation and the standard of equity of investment-income,and constructing the three-tier elements of the tort liability of “abusing of the shareholders’ rights”.Where there is the innovation,there is the deficiency.The above aspects have the problems of insufficient theoretical depth and insufficient case scale.