E Summary Of Study On Application Of The Disregard Of Corporate Personality System

Independence of corporate personality and shareholder limited liability are the two foundations of the corporate legal person system. In order to ensure the sound operation of corporate systems, prevent shareholders from manipulating company operation or abusing the independent corporate personality, the disregard of corporate legal personality system emerges as the time requires. The amendment to the Company Law of the People's Republic of China in 2005 symbolizes the official establishment of the disregard of corporate legal personality system in China.As a new legal system, the provisions of company law are too general and impractical, which causes disunity in judicial application standards and affects the implementation of this legal system. Therefore, it is necessary to carry out a detailed study on the application elements and circumstances under which the disregard of corporate legal personality system apply. Based on this objective issue, this article, by learning from the mature judicial experience at home and abroad, absorbing the results of researches by Chinese legal professionals and in light of the actual national circumstance and judicial practice in China, through the methods of historical survey, competitive analysis, demonstration analysis and economic analysis, surveys and studies the origin, development in various countries and establishment in china of the corporate legal personality system, systematically argues about its application elements and circumstances, and, based thereon, put forth suggestions on the improvement of the corporate legal personality system.This article suggests that, references may be made to the elements of an ordinary tort with respect to the application of disregard of corporate legal personality system, with an emphasis on such elements as the subject, object, consequence as well as an understanding of the subjective intent, causation and extent of damage. There are various types of public opinions on the specific circumstances under which the disregard of corporate legal personality system apply. As suggested in this article, there are mainly three circumstances: obvious lack of corporate capital, mixture of corporate personality and excessive control of a company to engage in illegal acts. And this article also takes into account the restrictions on application of disregard of corporate legal personality.The disregard of corporate legal personality in china needs further improvement, and this article proposes to start from establishing and improving legal provisions and relevant litigation procedures, putting more emphasis on legislation, establishing a legal precedent guiding system, formulating relevant judicial interpretations and establishing fundamental application principles; regulate the jurisdiction and acceptance of cases, strengthen burden of proof, specify the scope of parties concerned, regulate limitations and binding force of judgments, and lay a solid foundation for the comprehensive improvement of the disregard of corporate legal personality system in china through judicial practice.