Comparative Study On The Shareholder Derivative Litigation System Between China And Mongoli

Since 1991,Mongolia has been moving from a planned economy to a market economy,where state-owned enterprises were gradually privatized through a system of property privatization,and in 1992,a new constitution was adopted that recognized private property for the first time,and shares were first created on the market.Thus,the legal basis of the company was gradually established with the establishment of private companies.On 1991 the first adoption of the Law on Mongolian Enterprises was enacted,which established the legalization of the company and is the main legislation proving the origin of the Mongolian company and 1995,the beginning of trading on the secondary stock market,with the actual control of the stock in the hands of a few investors,and the rights of small shareholders,which were greatly infringed.In such a situation,in 1999,the Mongolian Company Law was enacted as a mechanism to protect the interests of minority shareholders,while the currently effective amendments to the Company Law were adopted only in 2011,a gap of 10 years.While the internationally recognized principles of good corporate governance have been legalized in the country’s growing foreign economic relations and trade,the establishment of a system of protection of the rights of shareholders and the company’s board of directors,clearly indicating the functions of its subordinate professional committees,ensuring the independence of the board’s activities,and improving the provisions of the highest management body of the company-the General Meeting of Shareholders-has become the most important issue in the current situation as the business of foreign investment companies is expanding and increasing year by year.-The provisions of the General Meeting of Shareholders have become a prerequisite for the present Company Law.Thus,the Company Law of 2011 was adopted in order to protect the legitimate interests of investors,mainly minority shareholders,and to improve the efficiency and management of the company.This provision was not removed by the amendments adopted in 2011,and is still on the books.The aforementioned right of shareholders to file lawsuits on behalf of the company is known as derivative action,and this right is an important mechanism to protect the rights of shareholders of the company,especially minority shareholders.It is a mechanism to control whether the company’s management fulfills its obligations faithfully and honestly,and to hold it accountable if it fails to do so.The amended Company Law provides for the right of shareholders of a company to bring lawsuits and derivative lawsuits on behalf of the company,but the question of how shareholders exercise their rights in practice is:What rights do shareholders have in practice? whether to exercise the rights and how to exercise the rights.Therefore,the rationale for choosing the topic is to file lawsuits on behalf of shareholder companies,to solve the problems related to the exercise of rights,and to find solutions by comparing with other countries.