The Prevention Of Corporate Deadlocks' Risks And Corporate Administration

The 183rd article of the Corporation Law about corporate deadlock has ordered a coercion of the dissolution legislation, but it cruelly lacks readability and regulation.'The problems occurred in the decisions of The Supreme People's Court of the Republic of China while applying'The People's Republic of China's Corporation Law (part 2)'published in 2008 clearly defines the circumstances of corporate deadlock but all the regulation made by the solving system of corporate deadlock are afterward solving mechanisms.This paper, by analysis of related theories about deadlocks and study on their causes, tries from the administrative part of a company to make prevention about corporate deadlock and to provide the company with a before hands'control of deadlock's risks.Therefore, this paper by analysis of corporate deadlocks and of corporate administration's basic problems, expounds the relation between corporate deadlock and corporate administration, analyses within a corporate administration the usual circumstances of corporate deadlocks and studies the deep cause of their occurrence. The author believes that the essence of the problem of corporate deadlocks is a corporate administration's issue; a deficient corporate administrative legislation leads to an administrative imbalance. In order to prevent a company from a deadlock, we should proceed to an analysis, a probe and a legislation structuring of the corporate administration.Through the experimentation of four different corporate structures:ownership structure configuration, shareholders'system, board of directors system, board of supervisors system, the author analyzed the reason why each administrative legislation was generating corporate deadlock. Then, during the settling of an administrative legislation in a company, the article analyzed an experimental corporate administrative system. Meanwhile, as the corporate deadlock was appears, it introduced an intern solving system. This paper focuses on the way ownership organizations'structures within corporate administration prevent themselves from the threats of corporate deadlock and the way shareholders or board of directors'legislation systems prevent and control shareholders', board of directors'deadlocks independently or simultaneously. It also deals with the company's internal solving regulation while any kind of deadlock arising. This paper is aiming at explaining the prevention of corporate deadlocks'risks and the configuration of a company's internal solving system in case of deadlock situation within a corporate administration and strives to solve the company deadlock problem on its own in a corporate administration.'The Corporate Law'solves the problem of company deadlock by enforcing dissolution, which runs counter to the wish of the concerned parties. This paper puts forward some opinions and suggestions for corporate administration which relies on regulations to prevent the risks of deadlock and the internal solving mechanisms established before the occurance of the deadlock from the perspective of non-litigation.