A Study On The Legal Problems Of Bankruptcy And Reorganization Of Affiliated Enterprises

Having many incomparable advantages over independent enterprises, affiliated enterprises play an important role in modern economy development. The enterprises, between which exists the associated relationship, can achieve the goal of optimum distribution of resources, thus reduce production-management cost and enhance enterprise competitiveness. In terms of the vigorous development of affiliated enterprises, we should possess a rational mind. The contradictory analysis tells us that everything has two sides, and it is essential to examine the both, so we could not just know about the positive side of affiliated enterprises while ignoring the problems that really exist. Enterprises operate with the fundamental goal of profit taking, and affiliated enterprises each has its own profit target. In order to achieve the goal, the abuse of associated relationship sometimes occurs. When bankruptcy happens, the controlling enterprise of the affiliated enterprises is more apt to take the advantage of control relationship or other significant influence relationship to do fraud, therefore brings harm to the auxiliary enterprises and social public interest disturbs the market economic order.Under "survival of fittest" circumstances, the affiliated enterprise bankruptcy is an inevitable outcome. The affiliated enterprise bankruptcy is the result of "survival of fittest" in market competition. In the legal system of bankruptcy, bankruptcy reorganization is different from traditional bankruptcy liquidation and reconciliation for it can save the enterprise more efficiently, thus protect the creditor’s benefit fundamentally. The new enterprise bankruptcy law China carried out in 2007 established reorganization system for the first time. It is a great innovation in Chinese bankruptcy legislation. However, there is no related legislation in domestic as for issues of bankruptcy reorganization of affiliated enterprises. Whereas, it occurs in the economic operation proceeds. This thesis proceeds with the case that this thesis proceeds with the bankruptcy reorganization case about Suntech in Wuxi, Jiangsu and discusses related problems about affiliated enterprise. Due to the lack of legal system, the judge will final himself so afraid in a lawless situation bankruptcy reorganization of affiliated enterprise when trying a case. Currently, there are several methods applied worldwide during reorganization of affiliated enterprise, such as piercing the corporate veil principle, deep-ruck doctrine and substantive consolidation doctrine. This thesis will have a comparative study of the three principles and they analyze the necessity of perfecting the substantive consolidation doctrine in our country.The body part of this is divided into five chapters.In chapter 1, the reorganization case of Suntech is introduced, for it is a typical and successful one. Therefore, he can raise the question and bet people to think through the case.In chapter 2, the legal definition of affiliated enterprise is set, and combined with the legislation at home and abroad, as well as the scholars’views. The meaning of affiliated enterprise is discussed. Besides, the legal features of affiliated enterprise are analyzed.In chapter 3, the legal questions related to bankruptcy reorganization of affiliated enterprise are discussed. The significance of reorganization will be analyzed and the problems existing in the process.In chapter 4, a study has been performed in terms of the origin and definition of piercing the corporate veil principle, deep rock doctrine and substantive consolidation doctrine. What’s more, the application range of the there principles and the status of their adaptability in China are analyzed. By comparison, the significance of reorganization is interpreted.In chapter 5, the construction and perfection of legal system of bankruptcy reorganization of affiliated enterprise in China are talked. The last is an analysis of the necessity of the adoptability of substantive consolidation doctrine in China. Besides, Legislative proposals are given by the author.