The Liability Of Injecting Capital After The Transfer Of Capital-Uncalled Equity

In order to optimize the allocation of resources and encourage the development of companies,the Company Law of China was significantly revised in 2013.The revised company capital system was changed from a period-limited subscription system to a full subscription system.Now,shareholders are no longer subject to the minimum registered capital and the statutory payment period when they set up a company.Shareholders can independently decide forms,amount and date of capital contributions in accordance with articles of association.Therefore,there are some shareholders who fail to pay their capital contribution because the subscription period has not expired.Moreover,some shareholders maliciously transfer their equity to the assignee who obviously does not have the ability to contribute before the expiration of the subscription period in order to evade the liability of capital contribution,endangering the interests of the company and creditors.Under the current law,shareholders holding equity which have not been paid before the expiration of the subscription period are not in violation of the law and should be lawful and effective.However,the Company Law of China has not yet made institutional arrangements on how to transfer the capital-uncalled equity,and who should assume the liability of capital contribution,capital maintenance and shareholders breach of contract after the transfer of capital-uncalled equity.In practice,the dispute arising from the transfer of capital-uncalled equity mainly focuses on the determination of the liability of subsequent capital contribution,that is,whether the assignor should continue to assume the liability of capital contribution after the equity transfer.This paper focuses on the liability of capital contribution after the transfer of capital-uncalled equity,and investigates the procedural and substantive rules that should be followed during the transfer of capital-uncalled equity,which is expected to benefit the judicial practice.This paper is divided into five parts.The first part of this paper introduces the background and the characteristics of the capital-uncalled equity,and emphatically analyzes the difference between the capital-uncalled equity and the capital-defective equity.It indicates that the non-payment of capital contribution by shareholders before the expiration of the subscription period does not violate the legal provisions and does not belong to the capital-defective equity.In the second part of this paper,some cases are carefully selected to show the differences in the judicial practice of local courts in determining the subsequent capital contribution.Through analysis,it is pointed out that the current law does not stipulate the liability for capital contribution after the transfer of capital-uncalled equity.It is inappropriate for some courts to invoke provisions of paragraph 2 of article 13 or provisions of paragraph 1 of article 18 of provisions on certain issues concerning the application of the company law(?)to order assignors to assume supplementary liability.The third part of this paper theoretically analyzes the capital contribution liability after the transfer of the capital-uncalled equity.The fourth part of this paper compares the provisions of relevant countries of the continental law system with common law system on the transfer of capital-uncalled equity,and summarizes their respective characteristics.The fifth part of this paper proposes that the transfer of capital-uncalled equity should be approved by more than half of all shareholders.And the transfer of large-proportion capital-uncalled equity should also refer to the company's capital reduction procedures.It also gives some suggestions on the liability of capital contribution,capital maintenance and shareholders breach of contract after the transfer of capital-uncalled equity...