Study On The Risk Of One Man Company

One man company is the company that has only one shareholder (natural or legal person), and the shareholder have all the investment or shares of the company (including limited liability companies and Co., Ltd.). One man company's birth and development due to the objective needs of people and the limited liability pursuit. Because of its advantages and disadvantages of co-existence, one man company has been controversial. The positive argued that one man company is business-friendly flexibility, cost saving, investment encouraging and employment promoting, to maintain harmony and stability of the society; the negative argued that one man company lacks of collectiveness, easy to cause the abuse of limit liability of the shareholder, so it is not helpful to protect the interest of the creditors and the development of the company.The practice has not only proved that the acknowledgement of one man company legislation is unable to forbid a substantive human of company, moreover, it cannot effectively regulate one man company, but also has disobeys the commercial law fair competition the principle, creates the law of corporation theory and the practice contradiction and chaotic, intensifies the abuse one man company. But, if is not regulated scientifically in the legislation, one man company can bring risk to the society, the creditor as well as to other benefit counterparts. The primary causes of the risk of one man company is that the traditional company power mechanism is out of balance in one man company,the merge of property with an annual bonus and the abuse of the limited liability.To prevent the risk in one man company , in the world all the countries which acknowledged one man company formulate relating regulations. In our country the legislation one man company has very good model significance. Integrated the provisions of China's company law, we can see that China's company law is granting legal status of the company and has formulated strict system of finance and capital to maintain the system, registration of public notice system, strict financial supervision system and more stringent than foreign companies .Personality denied system.Although these systems to a certain extent can prevent the risk of one man company, and safeguard the security of transactions to a certain extent, but there are still some deficiencies. One of the most obvious flaws is that it is not in accordance with one man company and the imbalance of internal oversight mechanisms aimed at building a company's internal system of checks, and balances and personality in the company denies the system of a company fairness, and the lack of application of the specific conditions and operability is not strong. It is difficult to play a character that the company's role in regulating the system afterwards. Of course, such as the setting of the registered capital too high; derivation of the one-man company, one-man company transactions and self-regulatory system deficiencies of one man company; e loopholes in financial supervision, and other issues.To introduce the company's creditors, employees and other stakeholders corporate governance structure is essential. Because of different interest demands of the stakeholders, directors, supervisors and a shareholder, among them can constitute a mechanism of mutual checks and balance . To compensate for a lack of internal checks and balances, this fundamental strategy should be the guard against the risk of one man company . Secondly, as a remedial mechanism after the company denied personality system, the legitimate rights and interests of creditors of the company relief, the law of equity plays an important role. To give better play to the system of relief , the paper applies the elements and specific circumstances of a company personality system .As the system of one man company personality applicable to the burden of proof is inverted, it should be a subjective act in deliberating into the one-person companies to prevent abuse of the plaintiffs right to appeal, adding to the burden of one shareholder, the law also demonstrates the value of fairness and justice.