Researches On System Of Shareholder Derivative Litigation Of China

The article 152 of the new "PRC Company Law" sets the shareholder's representative action. It has important significance to protect the interests of small shareholders and punish the directors who encroach on the company′s interests and improve the corporate governance structure. This paper tries to explore the areas of Chinese legislation where can be improved by assessing foreign and Taiwan legislation processes against Chinese specific features. First this paper analyses legal systems and provides some legislative advices in perspectives which are important in legal proceeding, such as the targeting of prosecution subject, the liability of proceeding costs, patrol policy, pre-hearing procedure, evidence collection, compromise, ect. And the writer points out their shortages and faults. Then a large number of legislation which are well developed in other countries and areas likely above institutions are collected. Last, the writer aims at the shortages about the shareholder's representative action of our country and combines previous good experiences so as to raises some legislation about our shareholder's representative action. In addition, it should also be recognized the plaintiffs right to compensation costs, lost for the shareholders of non-malicious, do not pay legal fees and so on.The law should clear shareholders derivative action litigation cost standard and confirm the plaintiff shareholders, losing compensation lawsuit, not malicious shareholder litigation expense burden. Shareholders of derivative action mechanism mainly includes the prepositional procedure, litigation cost guarantee system, reconciliation and withdraw procedure, etc. Shareholders derived litigation system is designed to protect the disadvantaged minority shareholder's rights. Although it is to protect the minority shareholder rights plays an important role, but the minority shareholder may also use this advantage to interfere with the normal operation of the company malicious damage to the company, and the order of the lawful rights and interests of the shareholders. Therefore, shareholders derived litigation system to protect the interests of small and medium shareholders but outside, should be limited to properly balance between interests to make the company the healthy development.