System Of Voting Trust Research

As an essential element of shareholders' rights, the shareholders' votingright has been regarded indispensable, and should be exercisedindependently by the shareholders without being dispersed. However, votingtrust originating from the U.S has changed this conception and practice. As atype of trust, voting trust means that a shareholder or a couple ofshareholders pool their voting rights and then entrust one or more trusteewho should, for any legal purpose, hold the share and exercise the votingright according to contract and law. Voting trust. Voting trust assigns thebeneficiary fight and the voting right to different person. Essentially, it is ameasure for shareholders to control or to affect the business of the companyby using the voting pool under the trust system. The ultimate purpose is torealize the utmost interests of those shareholders.The first chapter of this dissertation begins with the basic conception ofvoting trust. First it introduces the origin and evolution of voting trustsystem and explains that in terms of its legal nature, voting trust is anindirect way of exercising voting right in accordance with the Trust Law.Then it introduces the legal features of this special trust and analyzes thenature and functions of voting trust such as to guarantee the shareholders toexercise rights, protect the benefits of minority shareholders effectively,improve corporate management structure, promote the steady operation ofcompanies,ensure the imbursement of loans by the creditors and solve theproblem of vacancy in subject of ownership, etc. Finally a comparison ismade between voting trust and other two similar systems for exercisingvoting rights. As voting trust system itself originates from the actual socialeconomic activities, procedures for its setup and conditions for itsestablishment and operation must all be abstracted from practice and thentheorized and systematized to a legislation layer and in turn guide the legalpractice of voting trust. This is also true of the systems concerning theendorsement and public disclosure of voting trust contract, legitimacy oftrust purpose, confirming of trust subject and term. In terms of legal relations, the qualification of voting trust parties should be restricted. Thedeployment of the concerned parties' rights and obligations should beregulated by both Company Law and Trust Law. Especially whether theobject of voting right is share stock or the voting right generated from sharestock needs an answer in theory. The nature of property trust in voting trustindicates that signing written agreements of voting trust is the essential wayto establish voting trust. The thesis explores the forms, major provisions andpublic disclosure of voting trust agreement on the basis of practice. Upon thevalidation of voting trust agreement, what counts most is the exertion of theagreement. Thus it is necessary to account for the principles, scope andrestrictions for the voting fight exercised by the trustee. Besides, a completevoting trust system should include the legal effect of voting trust upon theparties, the company and relevant third party as well as the legal remedies asregards violation of voting trust. This should be regulated by both Trust Lawand Company Law. This thesis finally surveys the practice of voting trust inChina, demonstrates the significance of introducing voting trust system andconceives of the legal pattern of voting trust system in China.