Analysis On The Issue Of Shareholder Withdrawal System Of Limited Liability Company

As a corporate form both with funding combination and person combination, the Limited Liability Company (for abbreviation ,"LLC") is a kind of company with small number of shareholders. Compared with Stock-limited Company, it requires a certain degree of mutual understanding and trust. Additionally, there is no open equity trading market, so the approach for shareholders to exit is of a large degree of limitation. However, in LLC, the medium and small shareholders are usually oppressed and marginalized by the major shareholders, or there legitimate interests are violented in other forms. Therefore, in order to balance "Majority Rule" and the damage caused by the "Closure Form" of company, it has great practical significance to provide a more convenient way of relief for the shareholder of LLC. At present, shareholder withdrawal system is involved in many country's legislations and judicial practice. China also established this system in Company Law in 2005. However, compared with complicated practice, there are many deficiencies in this system. This essay will discuss the legislation and judicial practice both in domestic and internationally, including characteristics, theoretical basis and the value of the shareholder withdrawal system, in order to attract more attention on this issue, improve the shareholder withdrawal system in China, then make it play a more important role in practice .Overall, this essay consists of five parts:The first part is introduction which includes a brief description of the practical significance on the research of shareholder withdrawal system of LLC.The second part is basic analysis on shareholder withdrawal system. First, it will clearly define the concept of withdrawal of shareholder, by comparison with other concepts; Secondly, it will summarize the existent dispute from positive and negative, and then make a brief assessment. Thirdly, it will make a brief elaboration on the necessity and importance of shareholder withdrawal system. Finally, it will study the theoretical basis, to provide theoretical support for the developed research on the shareholder withdrawal system of LLC.The third part is comparative analysis on the relevant legal rules of domestic and foreign countries. It will enumerate relevant provisions, and mainly compare the provisions of Germany, the U.S.and China, in order to find the shortcomings of China's system, and then draw useful experience to learn.The fourth part is comprehensive proposal of shareholder withdrawal system of LLC. On the basis of current "Company Law" of China, this part will put forward a sound proposal from the scope, procedures, creditor protection, and several other aspects of the shareholder withdrawal system of LLC, in order to make this system play a more important role in practice, on the premise of balancing the interests of all parties.The last part is conclusion. It will summarize the main contents and views of this essay comprehensively and further stressed the importance of research on the shareholder withdrawal system of LLC.