Study On Cross Share Holding In Corporation Law

Cross share holding is a mutual supporting and restraining form of Joint Corporation in that through mutual investment between one company and another, both hold certain proportion of sharing and become the shareholder in the other one. Everything has two sides, so there is no exception for cross share holding. On one side, it advances economy; on the other side, it also brings on many legal problems. Therefore each country regulates the possible problems caused by it through legislation. However, 2005 revision of the "PRC Corporation Law" has failed to make corresponding regulation against cross share holding.On the basis of analyzing both the positive and negative effects of cross share holding, this article explores its special role in our national economy and then sets forth the design of legal regulations on cross share holding by comparative method in light of china's economic situation and legal environment. The article is structured as follows:The article analyzes the features and functions of cross share holding. It points out that it has the following features: The subject of cross share holding should be the company which can enjoy rights and assume obligations independently. Based on specifical intentions, cross share holding is reached between companies. Two or more companies hold shares or assets mutually or circularly. Each company holds certain proportion of shares and assets with one another. The economic functions of cross share holding lie in: the introduction of stable shareholders is beneficial to level off share structure and prevent purchasing and merging...