On The Direction's Civil Liability In Chinese Company Law

The expansion of the power of the board of director's is one of the trends of the development of the mordern company system. Nowdays, the important countries in world are strengthening the director's civil liability in company legislation, that maintains director's parity of power and responsibility. In China the director's civil liability is mentioned briefly in the current company law. Since the modification of the present company law being considered, we can use the successful legistation experience and well-developed theories of foreign countries for reference to perfect the director's civil liability in our company law.This article consists of five parts, and the last part is the most important.The first part defines the concept of the director, the relationship between the director and the company, and the obligations of the direction. These are the legal bases for the director to undertake the civil liability.The second part points out the director's civil liability for his company is the concurrence of the liability for breach of contract and the liabilityfor tort, and it conforms to the four constitutive requrement of the theory of the tort liability. The director must undertake the civil liability for his company when involved in four situations such as the excess of power or authority.The third part concentrates on the imperative establishment of the director's civil liability for a third. This is a legal liability. The third part includes the corporate shareholders, the creditors and other people whose interests are related to the company.The fourth part deals with the way of investigating into the director's civil liability, such as the shareholders asking the director to stop the illegal act, the company and the shareholders instituing a proceeding against the director, the director undertaking jont and several liability for the company. Besides, the relief system of the director's civil liability isalso mentioned.The fifth part mainly dicusses some aspects of the director's civili liability in our company law which need perfecting. The company law should clarify the mandatory relationship between the director and the company, increase the director's duty of care, strengthen the supervisor's supervis for the director's civil liability, clearly define the director's civil liability for a third part, and perfect the system of the procedure of the representative of stockholders and the exemption of director as well.