A Comparative Study on the Application of Shareholder Loss of Equity System
DOI:
https://doi.org/10.54097/c13cac90Keywords:
Shareholder Loss of Equity System, Directors' Call for Capital Contributions, Shareholder Expulsion, Acceleration of Maturity, Corporate GovernanceAbstract
Entering the "14th Five-Year Plan" period, China has introduced the shareholder loss of equity system into the "Company Law," aiming to strengthen shareholders' capital contribution responsibilities and safeguard the authenticity of company capital. However, due to the abstract nature of the legal provisions and the lack of judicial interpretations, academic debates are ongoing and consensus is elusive, leading to doubts about the applicability of the system and insufficient activation efforts. To address this dilemma, this paper first elucidates the system from three aspects: applicable conditions, operational procedures, and legal consequences. It focuses on comparing and analyzing the shareholder loss of equity system with the directors' call for capital contributions the shareholder expulsion system, and the accelerated maturity system, clarifying the applicable scenarios and functional differences of each system. Based on the aforementioned analysis, the paper proposes three major recommendations: to introduce the shareholder loss of equity system in judicial interpretations to define its status; to add provisions in the judicial interpretation to delineate the scope of the system's application from both positive and negative perspectives; and to optimize the operational procedures of the system through measures such as the related director's recusal system. The aim is too perfect and activate the shareholder loss of equity system, unleash its full potential, and promote the sustained and healthy development of the socialist market economy.
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