Research On The Protection Mechanism For The Right To Dividends Of Shareholders Of Limited Liability Company

The ultimate purpose of shareholders to invest into a corporation is to get investment returns. Since dividends distribution is a major way for shareholders to get their investment returns, the right to dividends is quite important to shareholders. Because of the closure property of limited company and the absence of an open equity-trading market, dividends distribution is more important to shareholders of limited company, minority shareholders in particular. In the field of corporation law, the principle is that, a corporation is not allowed to distribute dividends to its shareholders when it is not profitable, but it is free to decide by itself whether to distribute dividends and how to, if it is profitable. In practice, the will of a corporation is always controlled by its controlling shareholder, who always abuses its controlling power to infringe minority shareholders'interests by making the corporation to distribute no or little dividend. This not only strikes minority shareholders'investment passion, but also hurts the long-run development of the corporation. At present, the protection mechanism for the right to dividends of shareholders is not enough, the right to dividends of minority shareholders is not fully protected. The thesis provides some advices for bettering the protection mechanism for the right to dividends of shareholders after its analyzing the present situation of protection of minority shareholders'rights to dividends in China and studying foreign advanced legislations.The thesis is composed by the following five chapters:Chapter one is about the fundamental doctrines on dividends distribution. In this chapter, the concept of and classification to dividends, the value and conditions of dividends distribution will be discussed.Chapter two analyzes the theoretical basis for protecting the right to dividends. The aim of this chapter is to seek theoretical basis for the protection of the right to dividends. To make it, this chapter makes analysis on the capital majority rule and its problems.Chapter three introduces the current situation of the protection of shareholder's right to dividends in China, and further lists the available ways to protect the right to dividends but points out the inadequacy of such way.Chapter four introduces the legislations in America and Britain on protection of the right to dividends. It also makes discussion on some relating cases.Chapter five focuses on promoting the protection of the right to dividends. Taking the foreign legislations as reference, this chapter provides some feasible suggestions for promoting the protection, which includes to bring into full play the function of corporation's chapter to make arrangement, to establish the system of compulsive distribution of dividends and to better the system of the appraisal right of dissenters.