Brief Analysis Of The Non-monetary Contribution Of The Shareholders Of The Company

The contribution by the shareholders, which the capital of corporation originates from, is a core issue in corporation system. Scholars often take the capital of corporation as the blood of a corporation flowing in the whole process of the corporation. The sufficiency of corporate capital is vital to the future of the corporation and the interests of the creditors.The objects of the contribution by the shareholders are often composed of currency contribution and non-cash contribution (including tangible and intangible assets and rights).Non-cash contribution could also produce economic interests as currency contribution could. Besides, its advantages include high economic value, low actual cost and convenient process. Although the new corporation law expands the rage of non-cash contribution, the provisions seem too general, lacking strong operability. Meanwhile, scholars` opinions vary on the following issues: weather the Mortgage kinds, land use rights, intellectual properties, shares and creditors rights could be accepted as non-cash property, how to protect the safety of non-cash contribution and so forth. After reading plaintiff related materials, the writer discuss the above problems,This paper is structured as follows:Section one introduces the rationale of contribution by the shareholders and non-cash contribution, such as the concept, nature and the importance of them;Section two analyzes the criterion for the objects of the non-cash contribution. The writer believes that"five prerequisites"should be the best criterion, and non-cash contribution should fit the five conditions at the same time. Basing on the theories of"five prerequisites"------ certainty, present existence, possibility of evaluation, transferability and practicality, the writer discuss the two core requisites prescribed by our corporation law. The provisions of our corporation law emphasize the core criterion and much more briefly than the theories of"five prerequisites", but improving these provisions are still needed.Section three studies the types of non-cash contribution. The writer analyzes some typical non-cash contribution, including physical assets, land use rights, intellectual properties, shares and creditors rights. The former three are explicitly listed in corporation law as non-cash contribution; the later two are more disputable in practice. With the criterion discussed above, the writer considers that all the above types are acceptable as non-cash contribution.Section four surveys the approaches to protect the safety of non-cash contributions. Safety is always one of the values pursued in corporation legislation. Effectively protecting the safety of non-cash contribution is a hot topic in academic and practical fields. With the different features of physical assets, land use rights, intellectual properties, shares and creditor's rights, the writer surveys the common and different approaches to overcome the problem of contribution deficiency.This paper ends in section five with some concluding remarks.