Guarantees Provided By The Company Legal Issues

China’s1993"Company Law" Article60, paragraph3provides that the company’s directors and other senior management personnel shall not use the Company’s assets shareholder of the Company or any other personal debt guarantees. This is the earlier legal provisions of the Guarantee Business of the company’s external system. But the provisions are too broad and crudeness, caused by a many of controversy in the theory and in practice a many, which making the external guarantees behavior of the Company lack of the necessary regulation while the growing proliferation. After long deliberation and repeated research, the "Company Law" came into being in2005, in which the system of guarantees provided by the Company is more reasonable and detailed provisions. But the face of the rapid development of the socialist market economy, the hysteresis characteristics of the legal exposed, although the Companies Act2005to further improve the company’s external security system, but there are some omissions, making practice on the guarantees provided by the Company lack of a unified applicable standards, in theory, also produced a series of disputes. Through the study of this issue, the author summed up the following two controversial focus:first, whether there is the capacity of the external guarantees; Second, in the exercise of the power of the external guarantee, if the violation of the Articles of Association of the relevant provisions, external Guarantee of effectiveness should be identified. The above two issues will be the focus of this study.The first part of the article start from the basic concept of the company’s external security system, the unique value of the company’s external security system and the consequent risks inherent in, summarizes the confusion status quo of China’s external guarantees of the Company. One of the reasons of this phenomenon is the relevant laws and the provisions of the company’s external security system flaws.The second part, Summarizes the major countries and regions in the world of corporate law guarantees the company the ability whether specific provisions. First, European and American countries and regions listed on the legal requirements of the problem, followed by analysis of China’s1993"Company Law" and the2005"Company Law" the relevant provisions, guarantees that the company has the ability to act is the mainstream of the world viewpoint, but also for our country in2005,"Company Law" expressly made.The third part, around the company’s violation of external guarantees the validity of an act to start discussion. Focuses on whether the company articles of association with external effect, analysis of whether the first paragraph Article16new company law is mandatory provisions, and a third person whether has the obligation to review the Articles of Association of the Company or not.The fourth part, there are some suggestions to further improve company’s external security system. On the one hand we should improve the relevant provisions Articles of Association of the Company, and strengthen the management level of the company’s executives. On the other hand improve relevant laws and regulations. At the same time, we must strengthen the bank credit departments of the loan review responsibilities.