Research On The Exercise Of Shareholders' Preemptive Right In Judicial Auction

With the advent of networking and information age,online judicial auction has become the preferred way for people’s courts to enforce equity assets.Compared with joint stock limited companies,limited companies have relatively prominent "human cooperation" and "group nature",for which a preemptive right system has been established.However,from Article 72 of the Company Law of the People’s Republic of China(hereinafter referred to as the Company Law)to relevant judicial interpretations,there is no specific provision on how to exercise the "right of first refusal".Especially in the auction procedure,there is an obvious conflict between the "right of first refusal" and the "higher price",which has caused the inconsistency between judicial adjudication and application in practice.To this end,the nature of the shareholders’ preemptive right should first be clarified,that is,special rights in the company’s organizational law.Secondly,flexible delivery methods should be adopted and coordination and communication with the market supervision department should be strengthened to ensure the right to know of other shareholders and the openness,fairness and impartiality of the auction process;Third,it is clear that "equal conditions" should be based on meeting the core elements of the number,price,payment method and period of equity transfer,taking into account the implementation,special relationship and other factors,and retaining certain discretion of the judge;Finally,through the improvement of the relief mechanism against the preemptive right of shareholders,the free transaction of equity and the protection of "human cooperation" can be balanced between the autonomy of shareholders’ will and the fairness and justice of judicial execution,and the dispute can be settled without litigation.