On The Conditions Of Transfer Of Shares Of The Limited Liability Company

The unique feature of Limited Liability Company lies in its character of a combination of credit and capital, which give reasons for the restriction of share rights transfer. The regulations concerning share rights transfer in limited liability Company in our recent company law is in too wide range of meanings to solve the specific problems.In the first part of this article, we delve into the general principles governing share right and share right transfer, and consider share right to be a new kind of civil right, share right transfer a dealing action without any change in the character of company. Lastly, we give an introduction of the basic theory governing share right transfer.In the second part of this article, we first analyze the cause of differences between share right transfer in Limited Liability Company and Share Company. Then, analyze the two legal modes in the share right transfer between shareholders. After that we compare the legislation of outside capital transfer in Limited Liability Company in different countries and conclude that the basic principle of legislation is to realize the harmony of credit-combination and capital-combination. So, in order to realize the flexibility of share right transfer, the best way we should take is to combine express regulation in company law with the authorized regulation in articles of association. In the third part, we begin with the validity of a contract and examine the specific legal essentials for a valid contract of share right transfer. Then we come to analyze the procedural essentials of a valid contract that is the register of alternation of shareholder inside the company and the register in the association of commercial and industry. From above analysis we come to realise that the effective time of a share right transfer contract and the time of the alternation of the share right are two different concepts. We should hold the attitude that effective inside company register and the outside exclusive register should be combined.In the fourth part, we carefully analyze and examine the current legal condition in several special circumstances, and on the base of which, we find that in the relationships between the freely transfer and restrictive transfer, the freely transfer is the basic principle and the restrictive is the supplementary.At the end of this article, we come to the conclusion that it is urgent for us to revise our company law in view of the successful experiences from other countries.