Research On The Institutional Dilemma And The Solution Of The Performance Of Gambling Agreement

With the adjustment of the national policy of encouraging mass entrepreneurship and innovation,a large number of startup companies have flooded into the financial investment market.As a kind of contract solution,the gambling agreement is sought after by the financing market because it can bridge the valuation gap between different commercial entities and help to reach the transaction.At the same time,the issue of its legitimacy is also controversial.Until November 18 th,2019,the Supreme People’s Court issued the Minutes of Civil and Commercial Trial Work Meeting of National Courts(hereinafter referred to as Minutes of Nine People),which not only responded to the long-standing questions about the legality of the gambling agreement,but also pointed out new judgment ideas for the implementation of the gambling agreement.That is,after the failure of the gambling agreement,when the investor requests the target company to fulfill the obligation of share repurchase or cash compensation,the court should take whether the target company has completed the capital reduction procedure or whether it has distributable profits as the judgment standard for the performance of the gambling agreement.Since then,the focus of controversy in this field has shifted from the issue of effectiveness to the issue of performance.However,under the restriction of the principle of capital maintenance,when investors request the target company to fulfill its obligations according to the gambling agreement,the target company’s equity repurchase obligations and cash compensation obligations often encounter many obstacles,so it is difficult to implement them as promised.This will inevitably bring many influences on the space of contractual autonomy,thus seriously reducing the investment enthusiasm of investors for financial innovation.This paper will try to break through the dilemma of the performance of the gambling agreement,combing the legislative provisions of the performance of the gambling agreement in China,combining with the relevant case judgments,taking the legal problems existing in the gambling agreement as research materials,digging out the reasons of the performance dilemma at the institutional level,and trying to put forward feasible countermeasures for the system dilemma of the performance of the gambling agreement in China by learning from the beneficial experience of foreign countries.This paper puts forward that we should pay attention to innovating the applicable standards of stock repurchase performance and improving the applicable standards of cash compensation performance system.The former requires that the status of the capital maintenance principle be re-determined,and it is clear that the capital outflow caused by the performance of the gambling agreement is the contract performance expenditure of the normal business between the investor and the financier,and it cannot be taken for granted that it violates the capital maintenance principle;Under the background of the current capital system,we try to compromise the introduction of solvency and ease the strict capital constraints;Establish a board-centered decision-making mechanism,respect its commercial judgment ability,and give play to its management ability;Introduce a third-party organization to help investors confront the board of directors,play its role as a gatekeeper of corporate capital,and reconcile the interests of all parties.The latter requires to be included in the scope of application of preferred shares,which is in line with the reform trend of Company Law and breaks the rigid use of profit distribution procedures.Refine the target company’s publicity mechanism for gambling information,prevent creditors from misunderstanding the appearance of the company’s registered capital,and curb the dilemma of fulfilling the gambling agreement.