On China 's Shareholder Representative Action System

Shareholder’s Derivative Action, also called Derivative Action by some scholars, generally refers to the lawsuit filed by the shareholder in order for the company to obtain compensation, in the case that due to some reason the company does not file a lawsuit for being invaded.It is generally thought that under the management mode of separation between the right of operation and the right of management, the existence of Shareholder’s Derivative Action is good for the board members, the supervisor and the higher management to undertake their due Duty of Loyalty and Duty of Care, and is good for protecting the interests of minority shareholders, defensing and suppressing the action of the company controlling people, then protecting the interests of the company.This kind of lawsuit origins in the 19th century. It was established as a kind of institution by Britain and America, combined by a series of precedents and principles. Then, it was introduced into civil law countries,such as Japan, Germany and France, as an important institute for the company law in those countries.In the amendment of Law of Corporation in 2005, our country also introduced the institution of Shareholder’s Derivative Action in the terms.However, provisions of Pre-procedure of Shareholder’s Derivative Action and status of company litigation in current legislation have their limitations, which bring them into difficult position. Thus, the institution cannot play its due role and the situation that the interests of minor shareholders cannot be met is still not changed. Therefore, the writer launches this study under these circumstances. The paper consists of three chapters besides the introduction.The introduction of this paper expounds the background, purpose and significance of the study and introduces the subject of this paper.The first chapter is an overview of the Shareholder’s Derivative Action Institution. It emphasizes on the basic matters, such as definition, history and evaluation, which form the theory foundation of this paper.The second chapter is devoted to the current situation of Shareholder’s Derivative Action Institution in our country. The writer introduces the provision of Shareholder’s Derivative Action in our country, especially that of the client and Pre-procedure of Shareholder’s Derivative Action. She also analyzes the existing problems in the Shareholder’s Derivative Action Institution in our country in the current situation, which include limited duties, Duty of Care, inflexible Pre-procedure of Shareholder’s Derivative Action, indefinite company status, etc.The third chapter is committed to the completion of the Shareholder’s Derivative Action Institution in our country, which is also the core of this paper. The writer tries to come up with solutions for the existing problems in the Shareholder’s Derivative Action, which consist of observing generalized law, completing Duty of Care, making the Pre-procedure of Shareholder’s Derivative Action flexible and making the status of the company clear.