Legal Research On Current Issues Of Shareholder's Right Trust In China

Shareholder's right trust refers, in Chinese Law, to shareholder transfers all or part of his shareholder's right to trustee based on trust. Both parties of shareholder and trustee should enter into a shareholder's right trust agreement, and trustee will, in the capacity of himself, conduct management activities in compliance with shareholder's wishes for the benefit of beneficiary. Shareholder's right trust both has the relation and has the difference with nominal holding of shares, custody of equity shares, voting right agency and shareholder's right transfer.Through the comparison and research on legislations of shareholder's right trust between two legal systems of the world, the author considers that China should gain a good deal of enlightenment from the relevant legislations of two legal systems in many different aspects, such as orientation of legislation, trust purpose, trust subject, trust declaration, forms of trust, term of trust and so on.With regard to the meaning of shareholder's right trust, the author maintains that the subject of trust can be whole of shareholder's right and also can be a kind of rights with the core of uses or a kind of rights with the core of voting power. However, it will not be accepted by law that transferring some rights which are not crucial to trustee, but leave other important rights to be still kept by shareholder.As for the issue of party's qualification of shareholder's right trust, the author holds that settler must be the holder of shares i.e. shareholder or his legal grantor. When contradictions arise on the issue of determination standards of shareholder, the essential standard is always more preferred than the standard in form. In the case of both nominal shareholder and substantial shareholder all claim their rights, substantial shareholder should in principle be recognized as qualified settler, unless a third party is involved as a bona fide purchaser. In the circumstance of our current laws or regulations impose special requirements on qualification of holders of shareholder's right for specified enterprises, both of settler and trustee of such shareholder's right trust should satisfy the requirements at the same time, so that a legal and effectual trust can be established.With respect to the determination standard of validity of shareholder's right trust purpose, the author holds the opinion that shareholder's right trust is involved in a nonfigurative category. In order to avoid the stifling of positive function of trust, a comprehensive case study should be carried out from an overall view by a way of analyzing different aspects such as trust contract, trust purpose, content of beneficial right of trust, beneficiary and purpose of law.In addition, the author also claims that the condition of the establishment of shareholder's right trust is transfer of shareholder's right. Shareholder's right trust will be considered as not established when the transfer registration of shareholder's right is not completed. In the situation that current laws or regulations impose the restricted requirements on shareholder's right transfer, unless in laws or regulations it is otherwise provided, such requirements are also should be complied by shareholder's right trust. The registration of shareholder's right trust is the necessary condition of the establishment of shareholder's right trust. Shareholder's right trust will not be established when the registration is not completed. In addition, a registration system of shareholder's right trust should be established by law, which should include different aspects as registration subject, registration object, registration content, registration procedure ,and so on.Finally, in the period of shareholder's right trust, trustee can divide voting power into different parts and conduct them under the indication of settler...