Research On Employee Stock Ownership Plan

Employee stock ownership plan (hereinafter"ESOP") originated from USA and prevailed in western countries as an employee benefit plan and incentive mechanism. ESOP was introduced into China mainland accompanying with the reformation of state-owned company property right system through a tortuous course, grown up rapidly in the early stages and went through a lag phase before redevelopment. During this period, along with the revision of Company Law, Securities Law and Tax Law, the establishment of Trust Law, and the multiple regulations issued by the China securities regulatory commission (hereinafter"CSRC"), state commission for restructuring the economic system, the ministry of civil affairs, the ministry of finance and the relevant authorities, ESOP was fell under an inconsistent and complicated supervision system which make the company that applied the ESOP disoriented in the practice.Through analyzing the theoretical basis and the development in practice of ESOP, combined with our current laws and regulations, compares the advantages and disadvantages of the three most common shareholding patterns of ESOP, expounds the practice effects produced by each stockholding pattern itself with real cases, this thesis formulates different stockholding patterns appropriate for different types of companies. The author deems that, as for any single system, when there is appearing to have some imperfections under the regulation, it's not the sole solution to set up special laws for it. As a legal learner, how to perfectly operate a system in so far as it is possible under the existing legal framework and legal environment is of more significance than create a law with the purpose of improving a system. Therefore, at the end of this thesis, the author summarized the legal restriction which the ESOP faces in practice, and present solutions for this system under each stockholding pattern. The full thesis structured as follows:Chapter one,"General overview of ESOP", mainly elaborates the conception, characteristics, theoretical basis of the ESOP and its development in practice in China and the USA, some useful experiences and enlightenments from the US practice for our own system are summarized as reference. Chapter two,"Analysis of patterns for ESOP", analyzes the three most common shareholding patterns in practice with real cases, draw a conclusion on respective details of the advantages and disadvantages of trust shareholding pattern, company shareholding pattern and labor union shareholding pattern. Chapter three,"Problems that ESOP has encountered and the corresponding solution under the law", sums up the restrictions and bottleneck which ESOP confronts with in current legal environment, and comes up with various solutions towards different patterns. Meanwhile, the author also provides personal suggestions of amendment on relative laws with regard to inextricable problems in practice.This thesis adopts the method of comparative analysis, case analysis and comprehensive analysis, based on both the theory and the practice, in combination with relative laws and regulations of China, with the purpose of rendering some thoughts and achieving better practice effects for companies which applies the ESOP.The innovation of this thesis lies in that it initially put trust shareholding pattern, company shareholding pattern and labor union shareholding pattern together for comparison and introduces cases in analyzing advantages and disadvantages of each pattern. It brings up the common problems each pattern would face and raises respective solutions for corresponding patterns. Then it recommends that the companies applying ESOP shall choose suitable shareholding pattern for their own problems to solve.