Analysis On Shareholders' Right To Inspect Books And Records With The Perspective Of Chinese Company Law

The operation of modern company is based on separation of its ownership and control. As owners of companies, shareholders no longer participate directly in business of companies. Instead, the management of companies such as directors and managers usually has an absolute control on companies'core information. The imbalance between shareholders and management on information is increasingly serious. To enlarge the rights of shareholders to information and protect the lawful interests of investors is a trend on corporate legislation. As a core part of shareholders'rights to information, shareholders are entitled to inspect accounting books of the company, which involves important information about the financial and commercial state of the company. In western countries, the shareholders'right of inspection has been provided for a long time, has developed and becomes more mature. Our former company law didn't prescribe the shareholder's inspection of books and records. In 2005, the new company law provides the shareholder's rights of inspection, which is a great progress in the history of corporate legislation. But only an article in the new company law is very simple and not specific. And the shareholder's rights of inspection are not applicable in reality, full of much uncertainty. This paper will make an analysis on the shareholder's rights of inspection, based on cases law of foreign counties and opinions of experts. This paper consists of four chapters, about 35,000 characters.In chapter one, the basic concepts and essential factors are introduced. First, the paper points out that the shareholder's rights of inspection sterns from"information rights of shareholders theory","the accountability of accounting books theory","the previous supervision theory"and"cost and benefit analysis theory". Secondly, the shareholder's right of inspection is the original right, which is a useful tool for protecting the lawful rights and interests of shareholders. At last, the chapter focuses on who can inspect,what shareholders can inspect,how shareholders can inspect,juridical relief and so on.In chapter two, the author deals with the restrictions on the shareholder's rights of inspection. It is a basic principle of civil law that civil rights must be restrained and cannot be abused. In the same way, the shareholder's rights of inspection must be restrained. The chapter first discusses the theory of the restriction, then talks about the restriction on the subject of the right,proper propose and the scope of the documents.In chapter three, the definition of"proper propose"and its scope are discussed. The definition of"proper propose"and its scope are more and more meaningful under modern legislative trend, because the object matter such the percentage or length of shares has been canceled. Only the shareholder has established a"proper purpose"shall he or she have the right to inspect corporate books and records. In common law system, a proper purpose has been defined by statutory provisions as"a purpose relating to the interest that the stockholder sought to protect by seeking inspection", while leaving much room for case law. In Clack's opinion, a very famous corporate expert of America, the case law on the meaning of the proper purpose may be grouped into four categories. Based on the four categories, the paper expresses the specific content of a proper purpose.At the last chapter, the paper makes some conclusions. First, the author discusses the advantage and disadvantage on the provisions about the shareholder's right of inspection in our corporate law. Then to modify and better the institution, the author makes some suggestion, such as our corporate law should entitle the shareholders of a joint stock limited company to inspect corporate books and records, enlarge the scope of inspection, and define the"proper purpose"reasonably, and so on.