Research On The Legal Issues Of Bankruptcy Of Related Enterprise

With the continuous growth of the domestic and international economies and the rapid development of the economy,in order to adapt to the increasingly competitive environment,enterprises have chosen to use unfair and unfriendly illegal means,resulting in damage to the interests of external creditors when they obtain illegal benefits.In order to avoid the above illegal acts,the bankruptcy rule for substantive merger of affiliated enterprises has emerged as the times require,The relevant rules on substantive merger and insolvency of affiliated enterprises originated in the United States,which is a relief mechanism for fair distribution of company property created by United States courts to protect relevant individuals and interest groups when adjudicating related bankruptcy issues.The "Company Law" and "Bankruptcy Law" currently applicable to China’s laws are mainly drafted to solve the bankruptcy problem of a single enterprise,but they are not capable of resolving the exchange of interests and dark box operations between affiliated enterprises.However,in relevant cases and practical cases,the exchange of interests and dark box operations between affiliated enterprises not only seriously harmed the interests of creditors,but also caused extremely adverse social impact,Moreover,it challenges the bottom line of the law.If relevant laws or regulations are not introduced,it not only violates the principle of fairness in China’s bankruptcy law,but also leads to the phenomenon that there are relevant illegal facts that cannot be relied on.The Supreme People’s Court organized a conference on the bankruptcy adjudication work of national courts,which resulted in the first bankruptcy rule related to the substantive merger of affiliated enterprises in China,namely,the Minutes of the National Bankruptcy Trial Work Conference of Courts,which stipulated the substantive bankruptcy rules of affiliated enterprises.In 2021,the Supreme People’s Court issued three guidance cases on the substantive bankruptcy of affiliated enterprises,Together with the above "Minutes of the National Bankruptcy Trial Work Conference of Courts",it has played a significant guiding role in court trials of related cases,temporarily making up for the lack of legal basis for China’s courts to hear the substantive bankruptcy of affiliated enterprises.However,China does not have systematic and specific legal provisions for the above documents and guidance cases,and lacks strong legal protection for the application of the substantive bankruptcy rules of affiliated enterprises.At the beginning of this article,a brief analysis of related concepts such as substantive merger bankruptcy of affiliated enterprises was conducted,focusing on the necessity and feasibility of substantive merger bankruptcy.Subsequently,15 judicial cases that apply the substantive merger bankruptcy rule were randomly selected on the China Legal Documents and Adjudication Network,and their application subjects,judgment criteria,and startup modes were summarized in the form of tables and pie charts,Draw some existing legal issues in judicial practice,and then briefly discuss the legislation and practice related to the substantive merger and insolvency of affiliated enterprises outside China.Combining the specific national conditions of our country,adhere to the principle of focusing on ourselves and making our own use,and explore relevant legal experiences suitable for our national conditions.The last chapter of the paper mainly provides suggestions on the applicable standards,startup mode,and legal protection of external creditors for China’s substantive merger bankruptcy system,contributing to the establishment of a sound legal system in China.