A Study On The Transfer Of Equity Interests In Limited Liability Companies

Limited liability company is the enterprise organization mode selected by mostmedium-or-small-sized enterprises. External ransfer of equities of a limited liability company isthe right and freedom of its shareholders, and also one of the methods of capital circulation.External transfer of equities involves the interests of the company, its shareholders and creditors,so, in order to protect the interests of the company, its shareholders and creditors, it is necessaryto impose certain limitation on external transfer of the equities of limited liability companies;however, such limitation should not hinder the external transfer of equities, and instead, therelationship between limitation on such transfer and free transfer of equity should be balanced. Inpractice, the equities of a limited liability company might be complex, such as defective equitiesand the equities held by anonymous shareholders, which would affect the external transfer ofequities of the limited liability company. Starting from the concepts and basic issues of equitytransfer and transfer limitation, this essay analyzes the limitation on external transfer of equities,the validity of external transfer of equities, and external transfer of special equities, and putsforward some preliminary opinions.This essay consists of four parts, including the preamble and the conclusion.Part I firstly discusses the basic concepts of equities and equity transfer, and then analyzesthe classfication of external transfer of equities and the influence and meaning of externaltransfer of equities upon the shareholders and the company. It is noted in this essay that, externaltransfer of equities of a limited liability company would result in change in the shareholdingstructure of the company, and affect the personhood of the company and the stability of itsoperation, which closely concerns the interests of the company and its shareholders.Part II elaborates the limitation on external transfer of equities, including the meaning of,the reasons for and the methods of the limitation on external transfer of equities. This partanalyzes in detail the concept, contents and validity of statutory and contractual limitations. Itindicates that, free transfer of equities is one right of the shareholders, and the limitation on suchtransfer aims to maintain the personhood of the limited liability company and protect theinterests of the company and its shareholders in a better way.Part III elaborates the validity of external transfer of equities. It mainly analyzes the validityof the agreement of external transfer of equities of a limited liability company and the validity ofequities change, and puts forward the methods and suggestions that would strengthen the publication effect of equities change mode.Part IV discusses the methods of external transfer of several special equities, mainlyincluding external transfer of defective equities, external transfer of equities held by anonymousshareholders and the transfer through enforcement.This essay preliminarily but comprehensively expounds the external transfer of the equitiesof limited liability companies through the analysis and discussion on some basic issues. Based onboth theoretical research and judicial practice, this essay analyzes the relevant systems andprovisions in the company law of China, and put forwards the ideas and opinions, so as to bringsome light on and make certain contribution to the judicial practice of the company law of China.