Limited Liability Company Equity Inherited Legal Issues

The Article 76 in the new "The Company Law of the People's Republic of China" stipulates that: after the death of the shareholder, its legitimate heir may inherit the shareholder's rights, unless there is provided otherwise in the articles of the association. The provision ended the discussion of whether the shareholder's rights can be inherited and identified the principle that the shareholder's rights can be inherited. However the provision is abstract and has no regulations on the details during inheritance of shareholder's rights. And it lacks the operability in practices. Therefore this paper will do research on the inheritance of shareholder's rights through examples, comparisons and other methods for better practice guidance.This paper, starting from the concept of shareholder's rights , has explored the nature of it, made a clear analysis about the disputes of inheritance of shareholder's rights. The reference on the foreign legislative practice helps to explore the theoretical basis further. Then the article analyzes some specific issues on the inheritance of shareholder's rights. At last, this paper has put forward legislative proposals and tries to make models for the articles of association, from the aspects of the procedures of the inheritance of shareholder's rights, and of the transformation of company, drop of the rights because of the inheritance of rights.The whole thesis, in addition to the introduction , is divided into four chapters. The article generalizes the concept of the shareholder's rights and the double-nature of the acquirement of shareholder's rights from the different points in the academic field. From the four influential viewpoints in the law field, it concludes that the shareholder's rights have the nature of property and non-property, also the nature of benefit and total benefit. In addition, the article generalizes the disputes on the inheritance of shareholder's rights, and the different provisions about it in the legislative practice.The second chapter discusses the theoretical basis of inheritance of shareholder's rights. On the one hand, it clarifies the relationship between shareholder's rights and shareholder's eligibility. They are two aspects of one result from the same investor behavior. There is no relationship between the sequence of occurrence. On the other hand, it explores the feasibility of inheritance of shareholder's rights in the limited liability company. With the nature of property ownership and transferring, the shareholder's rights can be the object of inheritance. And the nature of personality of limited liability companies is not barriers for inheritance of shareholder's rights. At the same time, the related provisions in foreign legislation also confirmed the nature of inheritance of shareholder's rights.Chapter Three mainly analyses a special issue on inheritance of shareholder' s rights. In the inheritance of defective shares, this paper mainly described the concept and type of defective shares, the confirmation of the shareholder eligibility of defective shares and the theoretical basis for the inheritance of shareholder's rights and specific procedures. In the inheritance of pledge shares, it mainly explained the pledge of the basic theory, as well as by the comparison of the inheritance and transfer of shareholder's rights, to explore the particularity of the pledge shares. In the inheritance of legacy shares, it mainly explored "Legitimate successor" as well as the legatee of the scope of the disposal options. Finally, In the in- heritance of foreign equity, it focused on exploring the application of the law of inheritance of foreign equity, as well as inheritance caused by the foreign equity of companies in the process of change in the nature of the approval criteria, procedures and operational changes to the rules of registration.Chapter Five is mainly about inherited shares in the relevant legislation and improved model. The thesis suggests that three models of the company' s charter should be designed for the limited company to make charters. Meanwhile, against the status quo of China' s legal and social reality, as for inheritance of shareholder' s rights from its process, the changes of the company form of organization caused by the succession of the number of derivative-based one-man company, the shareholders into two or more less than 50, more than 50 shareholders over the upper limit, the give-up of the shareholder eligibility, or no succession and so on, the paper put forward a sound legislative proposals about inheritance of shareholder' s rights.