The One-man Company Law Regulation

With the development of economy, most countries have acknowledged the independent liability of one-member company to meet the demands of individual investment. "Law of Corporation" which was newly revised on Oct.27, 2005 explicitly acknowledged the legal status of one-member company. The only shareholder of one-member company has absolute domination over the company and has limited liability, which has met the needs of many investors of small and medium-sized enterprise. It dispersers the risks of shareholder and provides more flexible way in running business, avoiding the disputes between shareholders. The dream of enjoying the protection of limited liability has come true. But because the only shareholder controls the board of shareholders and directors, his absolute domination may bring latent risk to the creditors of the company. Therefore, the key point of regulations of one-member company is to supervise and restrict the shareholder's power to protect the benefit of its creditors.Based upon the domestic and foreign study on limited companies, especially on one-member company, the paper comprehensively analyzes the essence, advantages and disadvantages of one-member company. It sets up the principles and systems of one-member company. The core of regulation is to protect the benefit of the company's creditors, the key point is to supervise and restrict the shareholder's power. The legislation should be consummated in anticipation to strengthen the regulation of one-member company. When its only shareholder amuses the corporate-personality and limited liability, the limited liability of the shareholder should be removed. The law should strengthen to regulate the setting up and the capital system of one-member company, consummate the structure of the company's management and the system of liability, unify the supervision inside and outside. Such can strengthen the regulations of one-member company, maintain the security of transaction and the steadiness of the market, and...