Research Of The Pledge System Of Share Rights

As a rising guarantee mode, the Pledge system of Share Rights plays roles in market boom and financing. Chinese correlative legislation has lagged behind and has many loopholes so that it can't satisfy the demands of developing the Pledge system of Share Rights. The Real Right Law has made the improvement, but still had defects. This article reviews theoretical disputation and legislative shortcomings of the Pledge system of Share Rights, and brings forward some concrete ideas on legislative improvement which is expected to help correlative theories and practices.The first part of this article sums up the concept of the Pledge of Share Rights and points out the particularity of the pledge of share rights differ from other traditional pledges by defining share rights and pledge. And then analyzes the value-pursuit of the pledge of share. The second part of this article makes a comparison research on the pledge system of share rights as per the clue which is establishment and effectiveness of the pledge of share rights to combines other legislations and theories of different countries and regions.The third part of this article points out the legislative defects of the current pledge of share rights: the setting of share rights is too strict, the documents for the pledge of share rights becomes effective which confirmed by Real Right law are not so reasonable, the bound of share rights limits is not enough clear and the legislative lacks care of pledgor's rights, etc.Based on the expatiation above, the fourth part of this article brings forward some proposals of the Pledge legislative of Share Rights improvement. Firstly, to break restrict of current law for setting of share rights, to allow organizer of Ltd free set up pledge right and under a certain condition the company is allowed to accept its own pledge of share rights. Secondly, to distinguish different share rights types and reform the documents for the pledge of share rights becomes effective so that to accord with Chinese share right's current situation and improve the effective of share right setting. Thirdly, to limit the bound of share rights, define the ownership of the correlative property which related to cash dividends, Capital Increase and stock dividend etc. And lastly, to bring forwards an idea of how to ensure pledgor lawful rights and interests which contains not only realization of the right of presenting in shareholders' meeting and shareholders' voting and also the right of claim for advanced realization.