Research On The Institution Of Representatives In State-sponsored Enterprise

The director and supervisor in State-Owned Enterprise (SOE) supported by state-stock, who represent the duty of management and responsibility of supervision and putthe purpose of representative into practice to show the representative’s destination andprevent the state assets from losing, is actually the representative in SOE. However,our legislation and theory put more words on the civil right of representative andignoring the nature of public law, which makes the man who is under the shield ofIndependent legal entities using the power in civil right to free from his public dutyand forming an alliance with directors and managers in anti-SOE. In civilcircumstance which is lack of public law consideration, we should review theinstitution of assets contributor representative in state-owned enterprise based on thecontradiction of public and civil law.The nature of general public of state-owned causes the nature of public in itsusing purpose, while the fictitious nature causes the necessary of setting arepresentative. In the State owned enterprises, properties are owned by state, so thereis no obstacle in using ownership and no need to set representative. In the businesscompany, the state owned right is transferred into state-owned stock. Because of thelimitation of state-owned stock, the representatives, both the directors and supervisors,are supported by the contributor to execute the duty of management and supervision onstate-owned property to protect the nature of public property and the man who actuallyexecutes the power is the representative.In the state’s personality, public nature is principle while civil nature is secondary.When state is as an assets contributor, the public personality cannot be faded and theinstitution of contributor, such as state owned assets supervision and administrationcommission, gets the nature of public and civil right. While the representatives, suchas directors and supervisors, can be the subjects of duty for both civil law and publiclaw, respective to the representatives of civil law and public law. To prevent the stateowned assets supervision and administration commission to illegal control, legislationshould set the Shadow Director Institution, the institution of state compensation andthe separated institution between managers, which are to solve the problems of civiland public law.The representative in SOE is designed by state owned assets supervision and administration commission first and then to the voting procedure in general meeting ofstockholders, which are labeled with administration. The marketing designing methodconfused the line between representatives and managers. Based on the public nature,we should hold the administrative pre-designed route, as well as the company law onthe behalf of civil nature.The controls on the representatives by state owned assets supervision andadministration commission is the issues of public law, which including the assessing,encouraging and supervising. The current theory is based on economic performance(from the civil nature), adopting the yearly salary, distributing stocks and option toconstruct the supervision system. But this rule is designed for ordinary directors andsupervisors, ignoring the circumstance our paper. The representative holds the publicresponsibility of supervision and keeps some distance to company to some extend. Butthe current design is bound the man with company’s benefit to strengthen the internalcontrol. So we have to recover the assessing, encouraging and supervising from thecivil angle by referring to the reasoning elements of civil law to perfect the currentinstitution.Based on the civil and public position of representatives, their distributing onlegal responsibility should focus on the civil and public responsibility of state ownedassets supervision and administration commission. The public responsibility of stateowned assets supervision and administration commission is punishing, includingeconomic punishment, administrative punishment and exclusion limit. The civilresponsibility is harming responsibility, including seven circumstance ruled by Law ofthe People’s Republic of China on the State-Owned Assets. The claiming right isowned by enterprise, adopting the strict liability joint duty and The business judgmentrules to lighten their duty. At the same time, we should erect the insurance institutionfor directors and supervisors’ responsibility to match their burden.