Research On The Application Of "Unfair Purpose" In Shareholders’ Access Rights

In order to balance the interests of shareholders and the company,the Company Law of China stipulates that companies may refuse to provide access to accounting books if they have reasonable grounds to believe that shareholders have "improper purposes" that may harm the legitimate interests of the company.However,as an abstract concept that summarizes the subjective psychological activities of shareholders,’improper purpose’ is difficult to accurately define and apply.Therefore,further concretization and typification are needed.Article 8 of the Fourth Interpretation of the Company Law lists four situations through the typology of "improper purpose",but limited by legislative technology,the listed situations overlap,and there are still problems in the application,such as different identification standards and unclear application boundaries.These problems lead to the "improper purpose" rule can not play a role in balancing the interests of shareholders and the company,and at the same time,it is restricted by the judges’ legal theoretical literacy and life experience And the difference in subjective value judgments,as well as the frequent occurrence of different judgments in the same case.Therefore,in order to improve the accuracy and applicability of the "improper purpose" rule in judicial application,it is necessary to conduct research and provide suggestions on the application of "improper purpose".Firstly,the first chapter of this article provides a brief overview of the concept of shareholder access rights and the form of "legitimate purpose" regulations.The proposal of shareholder access rights stems from the separation of company ownership and management rights.There is information asymmetry between shareholders and the actual operators of the company,resulting in actual operators controlling the company and infringing on the interests of small and medium-sized shareholders.However,the unrestricted use of shareholder access rights may affect the normal operation of the company and lead to the risk of leakage of important business information.Therefore,based on the principles of balance of interests and good faith,various countries have proposed that shareholders exercise access rights with a "legitimate purpose".There are two forms of regulations regarding "legitimate purpose" : summary and enumeration.The summary provides a summary of the concept of "legitimate purpose",while the enumeration provides specific situations from the perspective of "improper purpose".Our country adopts the enumeration of "improper purpose".Article 33 of the Company Law stipulates the pre-procedure and scope of inspection and other constitutive elements for shareholders to exercise the right of inspection,and the Interpretation of the Company Law(IV)lists three specific cases of "improper purpose" and sets up the disclosure clause to improve the applicability in judicial practice.This article conducts empirical analysis by selecting a sample of 237 cases,and finds that firstly,there is an unreasonable allocation of burden of proof in the application of "improper purpose".Secondly,the criteria for determining substantive competitive relationships vary.Although courts tend to adopt a "one case,one verdict" approach,the specific criteria for determining the existence of substantive competitive relationships among shareholders are still unclear due to the vague theoretical basis for peer competition among shareholders.Different judges have different criteria for determining such relationships.Thirdly,the distinction between the application of "improper purpose" situations is unclear,leading to the company claiming multiple situations at the same time.When applying,the court becomes mere formality and fails to provide sufficient reasoning and argumentation for the company’s evidence.Fourthly,the application of "improper purposes" in judicial practice is rigid.If it is determined that the first three types do not exist,the purpose of shareholder inspection is deemed legitimate.Regardless of whether the shareholder inspection has harmed the legitimate interests of the company or other improper purposes,the basic clause of "other improper purposes of shareholders" should be equivalent to the first three situations.In response to the problems in the application of "improper purpose" in shareholders’ access rights,this article attempts to propose the following specific suggestions: firstly,reasonably allocate the burden of proof and clarify the "specific" standards for shareholders to explain the purpose;The second is to unify the criteria for identifying "substantive competitive relationships";The third is to clarify the application prerequisites and conditions of the "other improper purposes" cover clause;The fourth is to more accurately regulate the scope of access.If a shareholder has both a "legitimate purpose" and an "improper purpose",they are allowed to inspect within the scope that can be recognized as a "legitimate purpose".If the company has evidence to prove that the shareholder has an improper purpose for some of the inspection content,they are refused to exercise the inspection right within this scope.