One-Man Company Protection Of Creditors' Interests

The 18^th meeting of PRC National Congress Standing Committee passed the Amendment to "Corporation Law of PRC" on October 27th,2005. One-man company meets the needs of various investors with its appealing features,which are the limited liability and particular organization, therefore it will be great impetus of the development of corporations in China, and would be great help for setting up socialist marketing economics system for it is helpful to encourage investment, develop economy and facilitate employment. However, everything has its two sides. Compared with ordinary limited company, one-man company characters, which are the singularity of the stockholder and the particularity of corporate governance structure. Thus it increases the possibility for the single shareholder to abuse his rights and damage the interests of the company's creditor.This paper is composed of four parts, and focuses on perfecting the legal protection system of creditor's interests of one-man company.The first section title is one of the special nature of the company protection from creditors.This chapter not only the full text of the theoretical foundation ,but also the logical starting point for the entire. Firstly, this chapter analyse limited liability theory of value and then result a conclusion:limited liability increased the risk of creditors.Secondely, author introduce corporate social responsibility theory, also result a conclusion :it can be said that the company creditors such interest is the most important thing in the main category , therefore, the strengthening of the company to protect the interests of the creditors is necessary.The seconde section's title is a company protection from creditors particularity. Above all, analyse one man company's identity,and then point that just bacause this characteristics make one company's creditors responsibility more risk than ordinary company's creditors.The third section is analyzes the current situation of one-man company in China and current legislation defects. In the forth section author indicate that our county's company law must lead into Westward system .At the end of this paper, in great details the author provides with several pieces of advice for resolving the issues existing in China in order to perfect the legal system for protecting the creditor's interests of one-man company. The author introduces the frame of one-man company's creditor legislations of the newly Corporation Law, then puts forward a few measures such as investigate one man company's shareholder resbosibility,creditors have the right to know the company's financial information,companies should sound financial accounting system,director must undertake joint liability if his action blackly.