Capital Reduction System Study

The corporations' capital reduction means that a corporation reduces its total capital through legal conditions and procedures in accordance with the managerial actual needs due to a surplus of capital or seriousness of deficit. According to its economic aim, capital reduction can be classified to substantial capital reduction and formal capital reduction , which take place on different occasions . The thesis studies the corporations' capital reduction system . This writer thinks that the corporations' capital reduction regulations of our country should be reviewed , and also puts forward relevant suggestions on legislation .The first part of the thesis elaborates the extension and connotation of the corporations' capital reduction , the pondering over benefits conflict related to capital reduction and the necessity of the capital reduction .First of all ,the writer points out, concerning the capital reduction' s extension ,the concept of the capital reduction must be interpreted in different models of capital system due to the current existence of three major capital systems in the world , i.e. legal capital system , authorized capital system and compromise capital system ; in respect of its connotation ,capital reduction should be divided into substantial capital reduction and formal capital reduction . Secondly , the pondering on benefits conflict related to the capital reduction , the writer analyzes the protection of the capital reduction upon the benefits of the shareholder and the company creditor , and how to equilibrate the benefits conflict between shareholders and creditors .Finally ,the write demonstrates the necessity of the capital reduction.The second part of the thesis summarizes three models of the corporations' capital reduction and analyzes them briefly through investigating legislative conditions of the corporations' capital reduction system abroad . The writer sums up the proceeding introducing three models of the corporations' capital reduction regulations from legislative cases of capital reduction system in USA , Germany ,...