Capital System Study

Corporation capital system is a core of the corporation law, and a foundation of perfecting other systems of the corporation law. In view of international community, the corporation capital system is made up of three modes, legal capital system, warranty capital system and tradeoff capital system. The three modes, with their own historical and realistic reasons, have advantages and disadvantages respectively. The current capital system stipulated in the corporation law of China is a kind of strict legal capital system, with a purpose to guarantee legitimate rights of the creditors and security of the social trade to the maximum extent, and to safeguard conscientiously stability of the socialist market economy. However, in the course of implementing, such a strict legal capital system has not achieved its initial legislative purpose. With the gradual development of the socialist market economy in China and the setting-up of the modern enterprise system, especially after China's entry into WTO, China should adapt to the new economic trend in the world, tackling the severe challenge from the international community. Such a stiff and rigid system has influenced the operational efficiency of corporation in China, and form obstacles to the commerce and trade between China and other countries. The current situation requires China to transform the strict legal capital into tradeoff capital system, and to assimilate several advantages of warranty capital system, in order to insist on the rule of giving priority to efficiency with due consideration to fairness and to consequently protect the creditors' interests. This article makes use of research methods such as economic analysis, jurisprudence analysis to carry out preliminary research on theoretical foundation, value orientation and legislation choice of the corporation capital system.The article is separated into four chapters. Chapter one is the jurisprudence analysis of the corporation capital system, which, from the angles of economics and corporation law, discusses the meaning of capital and gives a detailed description of...