Study Of A Limited Liability Company Share Transfer System

The shares transferring system of limited liability companies is of great importance, which shows as follows: firstly, it will promote the innovation of legal theories; secondly, it will contribute to the settlement of shares transfer disputes that currently exist in a large quantity. The Company Law of our country has a very simple prescription on this system in Articles 35 and 36. It is obvious that the provisions are too simple to deal with such following complicated problems: could the shareholders avoid the application of Articles 35 and 36 through the articles of their company, how to fix the price of the shares; how on earth to understand "consent of the simple majority of shareholders"; how to hand over shares; when will a transferee obtain the status of shareholders, etc. For all sorts of reasons, people often put more concerns on joint-stock limited companies, in particular on listed companies, and the study on limited liability companies is relatively weak. So I hope this paper, which discusses the problem of shares transfer, can be a little use to change the present situation. The analytical methods of comparative jurisprudence, historical jurisprudence and economics are used in the present paper. Starting from such basic theories as the nature of shares, characteristics of limited liability companies and personalities of the company law, etc, the author analyzes the deficiency of the current stock transferring system, summarizes the experience of relevant foreign legislation, then proposes the author's own designing concepts regarding the stock transferring procedures. To be specific, this paper consists of seven parts apart from the introduction and conclusion. Its main contents are roughly as follows: The first part explains the concept and legal nature of the shares. Based on the analysis and appraisal of main current theories about the shares, this paper points out that the shares should be a type of new and independent civil right, so the system design thereof should be based on traditional rights, and the bold innovations are also required. The second part explains the particularities of shares transfer of limited liability companies. Compared with joint-stock limited companies and unlimited companies, the limited liability companies put the credit foundations not only on capital but also on contributors. Such a feature has a deep impact on the shares transfer of limited liability companies. The third part discusses the personality of rules about the shares transfer of limited liability companies, namely: should such rules be mandatory or optional? Through an analysis of theories about the personality of company law, and in combination with the characteristics of limited liability companies, this paper points out that the rules about shares transfer should be optional as a general rule. The fourth part discusses problems existing in the provisions on shares transfer. The regulation is too simple to include such following problems as how to treat the validity of a transfer if such transfer results in a one-person company. The author points out that the one-person company should be acknowledged in our country. The fifth part discusses the existing problems on the shares transfer to anyone other than shareholders. The meaning of Paragraph 2 of Article 35 is too fuzzy to play an effective role as a provision. The sixth part explains the author's concept on how to establish the shares transferring procedures of our country. The seventh part explains the difference between the effectiveness of a shares transferring contract and a shares transfer. Finally, the conclusion makes a simple summary of this paper.