System Of Director's Liability Limitation Of China

With the change of "general meeting centered" to "board centered" in the pattern of corporate governance, the power of directors rises rapidly because of their status. It is because of the behavior of director related to the company's fate, national company law have increased the responsibilities of directors. However, good corporate governance should find a balanced point between strengthen the personal responsibility of director and the relief of the liability of directors. It does not only damage the company and shareholders'benefit, but also ensure that directors will not too conservative because of too heavy responsibility. Because a conservative behavior and a barbaric behavior will both damage company profit. They realize this situation, and discuss a series of relief measures on director'responsibility. These measures play an important role in the work. As a measure of limitation of liability for directors, it plays an important role on protecting directors'business decisions. In the mainland legal system and the English America legal system country have the more perfect system design. The new company law of China broadens the path of investigating responsibilities of directors. However, the law does not relieve the liability of directors because of their general negligence. In the same time, few of Chinese scholars research systematically about relief of directors'liability. In this article, we discuss deeply this theme:" the legal research about limitation of liability for directors". The discussion about the topic only hasn't the theoretical significance but also the practical value. We hope our study can contribute to development of our Company Law and corporate governance structure.This article consists of four parts.The first section discusses the basic theory of directors' liability limitation system. It illustrates precondition and remedies of directors'liability limitation in detail. Through analyzing this part, the object of directors' liability limitation is monetary liability of directors for company due to good faith without gross negligence.The second part analyses directors'liability limitation system in foreign country. Firstly, I introduce "Business Judgement Rule" in America,England,Japan and so on. Then, I analyze the legislative model and background of directors'liability limitation. The conclusion of this part is:the business judgement rule doesn't fit to our legal environment during this present period. However, we may refer to legislative model on directors' liability limitation of Japan.The third part introduces directors' civil liability and analyzes necessity of liability limitation. First of all, this chapter introduces directors' liability and the way of investigated directors' liability in our company law. Next, it analyzes necessity of liability limitation in our legal environment. The conclusions of this part at last: With the way of investigated directors'liability improving, it shows the tendency of increasing directors' liability. Our research focus on finding a balanced point between the encouraging and restraining of directors, and between director' s determination and protecting the interest of the shareholder and company,The fourth part is the focus of this article. It is necessary that limiting directors' liability exists in our country by the analysis of the previous. This part advises to construct system of directors' liability limitation——the subject,the way,the condition of the system and the degree of the liability limitation.