Discuss The Restrictions On Joint Stock Limited Company Controlling Shareholders' Voting Rights

Voting rights are important rights to shareholders, by which controlling shareholders control the companies and infringe the interests of companies and minority shareholders. This paper wants to build a set of efficient mechanism to control the controlling shareholders voting rights, from the restriction on the abuse of controlling shareholders' rights and enforcing the protection of minority shareholders.This paper has five chapters, which the first chapter discusses the base theory of the restrictions on joint stock limited company controlling shareholder's rights and the last four chapter discuss the ways to restrict controlling shareholder's rights. Because of the principle of "One share, One vote" and "Majority Decision Rule" of the company law, minority shareholders' rights can't be protected effectively, especially the monopolizing shares in China. So we should restraint the principle of "One share, One vote" and "Majority Decision Rule". And the principle of equality between shareholders an duty of food faith is the excuse of limiting controlling shareholder's rights. The first way to restrict controlling shareholder's rights is perfection of the mechanism of voting, which include the perfection of the means to vote and the minimum amount of shares to convene shareholders meetings. We should introduce the rule of writing voting and Internet voting system. Also we need to stipulated the minimum amount of shares to convene shareholders meetings. The second way to restrict controlling shareholder's rights is the perfection of the method to vote, which include voting proxy, proxy solicitations, voting trust and voting agreements. We should improve the voting proxy and introduce the rule of proxy solicitations. But we shall prohibit the compensated proxy solicitations. Moreover, we need introduce the system of voting trust and voting agreements. The third way to restrict controlling shareholder's fights is limiting controlling shareholder's fights directly, which include the rule of depriving the controlling shareholder's rights, the rule of exclusion from voting rights and accumulative voting rule. The voting rights of the surpassing shares stipulated by the law shall be deprived. We also need expand the scope of application of the rule of exclusion from voting rights and establish the rule of accumulative voting rule as a compulsory item. The fourth way to restrict controlling shareholder's rights is the perfection of lawsuit of company resolution. We should establish three types lawsuits and stipulated the controlling shareholders who approve and receive interests as the co-defendants.