Economic Analysis Of China Company Law

The thesis carried out economical criticism on the law of cooperation, the revision in 2005. Firstly the thesis used efficiency, fairness and their relation as the governing principle for scientific legislation. Then, it carried out economical annotation on the building of fundamental theory of law of cooperation and concrete legal system, at the same time on the basis of analyze and argumentation, the thesis brought forward that how to improve and perfect them. Detailed state as follows:Development balance between efficiency and fairness. Economy decides law , efficiency is the embodiment of economy, fairness is the connotation of law , efficiency is priority to fairness. Our country takes "giving priority to efficiency with consideration to fairness "as the direction that economic growth and assignment which is comparatively scientific. But "give priority to efficiency with consideration to fairness" is a base, it should have corresponding change in different economic growth. In original starting of economic growth, we should to incline "efficiency", then to take sides to "fairness" in economic flourish, the rhythm of which followed the progressive extent and advanced gradually, this names "development balance ". 17th National Congress of the CPC bringing forward primary distribution will give consideration to fairness that is the embodiment of"development balance". Definitude of the nature of company. Company is in order to accumulate capital, and the basic driving force to realize this one purpose is limited liability; the existence and development of a company is because of the scientific corporate management structure, the shareholder , director , supervisor , manager decentralization, which have overcome the abuse, have boosted the enterprise health working; Company's structure of government, limited liability partner with the corporation, especially decentralization , not have few shareholder, has no way to embody. Therefore, the corporation of company, limited liability of shareholder, and decentralization are the company's nature.Legislation abolishment of one people company. One people company is identical to natural person, there have no problem about business cost; one people company doesn't have work divide or special, so that it is difficult to grasp all market information; it's scale is small, and unable to satisfy the enterprise and market, so it is not excellent. At the same time, monitors system to one people company have the natural hiatus, moral hazard is enormous; one people company can not take the information of debtor's risk degree to the creditor in advance, and can not guard against debtor's behavior after the event, then asymmetric information is enough to lead to reverse choice that makes a optimum creditor's rights to be difficult to come true. Therefore, because one people company has disobeying the company nature attribute, and has obvious abuse in practice, in our opinion, one people company should be abolish, replacing unlimited liability as individual-invested enterprise.Clear property rights of state-owned corporation. Illegibility of property rights is the basic problem to perplex state-owned enterprises reform. The government representative country who owns public authority manages enterprise, participates in competition, which is unfairly; The nature of economic man make enterprise operator can not fulfill his duty to state property. Illegibility of property rights make moral hazard and reverse choice aggravate. This is the vital point of deficit for the state-owned enterprises. In our opinion, major industry which is vital about nation's economy and people's livelihood, for instance, economic security, national security, providing of common product of society, should be supervised by the government, and company which have strength to compete should be regulated by market. At the same time, state-owned economy enters marketplace with the form of mixed economy embody, do not hold a share in advantage, to avoid becoming to be a state-invested company. That is, state-owned enterprise only has clear its property rights , participate competition in market equally, it can be have ability to lift vigour and to attain aim.Makes a choice to the effect of setting up with blemish. In ordinary, the cost of the company setting up with blemish is little than the cost of the company setting up with no blemish. Because our present economic and legal institutional environment, for efficiency and safety of market-trading, we may affirm a principle that allow the company that setting up with blemish, give the company the right to repair the blemish, make the company last, strengthen to call to account the man at the wheel and to compensate interest groups.Defect and reparation of limited liability. The merit of limited liability is outstanding, but the defect is also extremely obvious, if because of information asymmetry, when the company brings about the deficit and bankrupt because of poor operation and management, or company use sub-company to evade law, or property rights of company and personal property rights mix up, creditor's interest will be lost. Limited liability provided a opportunity for shareholder especially the director to abuses company personality and hindered creditor from requiring that the shareholder or the director take the responsibility, and so on. In this context, we think that we should perfect legislation firstly. For instance, canceling one people company, which is not only against the company's nature, but also confuse the personality of shareholder and company's, create condition for abusing limited liability. Secondly, we should establish company personality denying system, to balance the benefit between the shareholder and the creditor, to guarantee law justice.The power allocation of governing structure. Definitude the function allocation of governing organization, clear the border of it's power, can avoid unclear between right and duty, lessen cost and lose. Firstly, we should reinforce macro-supervision. Since grave information asymmetry, shareholders' general meeting exist in name only. There are three approach to change the status: to rule the bond market, resolving speculating versus investment fundamentally, promoting the consciousness about power of shareholder; to force information disclosure, shareholder's power being like a tree without roots if information is monopolized by inside personnel of company; to strengthen supervision, include annual report and censorship of shareholders' general meeting. Secondly, we should improve audit supervision. Audit includes external audit and internal audit. External audit is verifying to the company body, is one kind of mechanism that the owner supervises the operator of company. It include budget auditing and the final account auditing, project auditing about producing and managing, financial affairs auditing and others, and so on. External audit and its result should be censored by shareholders' general meeting. The internal audit is that the upper consignor supervises the lower agent in the inside of enterprise organization, which is a part of the management function. In the company, it mainly embodied that the board of directors supervises and managers the manager. The internal audit needs to be passed by the shareholders' general meeting and to be checked by external audit. Thirdly, we should perfect special supervision. Board of supervisors is the supervision executive organ of shareholders' general meeting, should take responsibility for shareholders' general meeting and bear related liability. At the same time, the member of board of supervisors should include the small and medium shareholder, representative of staff and worker of company , and creditor , who has intense emotion and driving force in supervising since they and company's benefit are. Fourthly, we should build independent director supervision. Make sure it becomes a governing implement to control the power abusing of shareholder, for other interactional beneficiary participating decision-making in company.Way to building honest and credit. Market economy is credit economy, our country credit hiatus phenomenon is current, it becomes the obstruction of economic growth, rebuild credit is indeed a task of top priority. Firstly, economic development is fundamentality to be lifting credit. Credit is the ingredient of superstructure, to which the economic base has the decision effect. so that the approach to resolve basic credit crisis in our country is to develop the economy. But, the economic development here is country overall economic propulsion and most national richness. Secondly, we should clear property rights and stimulate honesty and credit. The clearly property rights is the basis of the honesty and credit of a company. In market economy, the essence of trading is the property rights alteration, if property rights is unclear, then the honour and credit is unclear too, people will lose the driving force to be honour. Thirdly, we should improve legal system building of honour and credit. honour and credit should be embodied in legal institutions. At present, with the economic developing quickly in our country , the legal system such as "credit law ","fair deal law "should accelerate to build-up and to improve, then provides legal protection. Fourthly, we should structure social credit system. Building-up network of open public credit information consultation, making credit writer , credit quality , credit evaluation of company announced, aggravating punishment on the offender to change the environment to be safety.Perfection of the company's purchase. Company's purchase can brought about coordination effect of administering and managing together. One aspect, when company has different efficiency of management purchased, it can not only make up deficiency, and be able to reach higher effect according to the economic coordination effect principle. On another aspect, company's purchase can help concentrate different products which are relative in one company, it can be not only able to cut down a freight, save raw material , lowering production costs, scale economic fund and technological superiority, professionalize scientific and rational, then promote the ability to study and the level of innovation. But the scale of a company has a border, if exceeding the limit it would be diseconomy. So company's purchase is inadvisable to be bigger blindly, it ought to be stronger and fit in with the bearing capability of market. we should integrate scale or open up vaster competition while company's scale exceeds the border of market.Assurance of company's liquidation. Bankruptcy of a company is a "domino" matter, about the benefit of staff and creditor. Since the information asymmetry among manager, staff and creditor, when company entered in the bankruptcy process, sometimes they will be early doing consideration to be prepared for self action next step, or hide property, or control audit, and these made company shrink. Therefore, in our opinion, we should adopt an effective measure, guarantee the rights and interests of staff, worker and creditor. Firstly, in the period of bankruptcy, we should have a temporary keeper in which include staff the creditor participate, to prevent from opportunism action happened. Secondly, staff deputation and creditor may participate the company's liquidation, superintending liquidation dividends, eliminating dope-control. In short, expanding the rights of staff and creditor to participate and inform, is an effective measure to ensure the company liquidation.Reasonableness disaffirmation of company's personality. There is no standard in the law about disaffirmation of company's personality; there is no last word about taking responsibility with fault or not; and there is no unified cognition about whether require that the behavior of the shareholder brings about damage in which degree. The shareholder evidently doesn't undertake responsibility on breach of faith, but how to set up tort responsibility? Personality denies a law of cooperation failing to expound and prove the legal basis of a shareholder undertakes responsibility on abusing the company's personality. There is no legal theory about disaffirmation of company's personality, there is no unified standard suitable for use or composing qualification simultaneously, it does not deal well without the outstanding judge, but in our country judge is difficult to reach this request, therefore, there are many self-contradiction in the field of theory and practice. The abusing of company's personality is because of the leak of law about disaffirmation of company's personality, to puncture the company's veil is only passive remediation, to improve and to perfect the law in legislation is the radical method, so it is radical to prescribe the condition of disaffirmation of company's personality in detail.The scientific definition of company's crime. About company's crime , one kind of view thinks that the so-called company's crime is not referring to a company is the main body that commit a crime, but is that making the people take the criminal liability for his illegal activities abusing company's system; Another kind of view thinks that it is a crime of company committing, including any type can commit by company. But we think that the company is one kind of corporation, the company's crime is belong to the category of corporation's crime. When the company commits a crime , the corporation itself should bear the criminal liability, then punish the person in charge directly interior. Therefore, we should distinguish the different between company's crime and personal crime which is found after punctured the corporation veil strictly.