The Legal Analysis On Inheritance To Shareholder Qualification Of The Limited Liability Corporation

Since china’s reform and opening up, the socialist market economy has entered arapid development period. As the main players in the market, the company plays animportant role in the market. Because the country has always been supportingpersonal investment business, the Private Corporation has been developing veryquickly. In the recent years the form of the limited liability company has beenbecoming people’s first choice for the create procedure of the limited liabilitycompany is simple and convenient. Shareholder’s natural limited life and thecompany’s unnatural life are conflictive, so the inheritance of shareholderqualification is inevitable. Co., Ltd contains both capital cooperation and trustcooperation. The trust cooperation of a limited liability corporation demands theshareholders totally get to agreement in investment and commercial cooperation,namely the company is based on deep trust and sincere cooperation amongstshareholder. So the shareholder’s qualification will have some problems about theshareholder’s qualifications whether can be inherited and how to inherit.For discussion of these issues has theoretical and Practical Significance, therefore,each state Legislators have attached great importance to this problem. Thus, the article76in 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 share equity,unless there is provided otherwise in the articles of the association, but this provisionhas a lot of problems in practice.The thesis focuses on the issue of inheritance to the of shareholder qualificationwhich is introduced from the theory to practice by the way of comparison of differentlaw provisions from different countries and analysis of history and specific cases. Theauthor prefers to agree with the Identification of the seventy-sixth clause of newcompany law edited in2005which deals the cases on basis of confirm the theory ofinheritance of shareholder qualification. All the work aims to provide diversitychoices for the practice.Besides introduction and conclusion, this thesis consists of four chapters, asfollows:The first chapter mainly analyzes the theory of inheritance of shareholderqualification. On the basis of comparison between the rights and qualification belongto the shareholder, the author clears the connotation of the qualification of theshareholder and points out that the system of shareholder’s qualification is designed tobuild the tie between investor and shareholder. Following, the author introduces theconcept and nature of the inheritance to shareholder qualification of the Co., Ltd,based on which the author concludes the analysis of the feasibility and the feature ofinheritance to shareholder qualification of the Co., Ltd. In the author’s opinion, theessence of the inheritance is circulation of right on identity and status, is thesubrogation of the ownership and benefit. The qualification inheritance is theheritance of whole property and identity right. On the other hand, the shareholder’squalification is conducted as the object of inheritance because of the characteristic oftransference between different shareholder’s right.The second chapter introduces the legislative and judicial practice of theinheritance. The author summarizes three modes of the overseas legislation, and onthe bases of the summaries the author analyzes the historical legislation in our country.Finally, the author shows his own opinion on defining the following principle of thequalification heritance: the76th clause of "Company Law" defined the right of legal inheritor on inheriting the shareholder’s qualification, which fills the legislative gapsin our legislation. at the same time, from the angle of protecting other shareholder’sbenefits and respecting the harmonious cooperation, on the basis of proviso, thelegislative branch provides shareholders the privilege to make constitution to dealwith such problem by themselves and clearly defines that "unless it is otherwiseprescribed by the articles of association" which leaves the shareholder large room ofautonomy.The third chapter analyzes the specific practice of inheritance. the analysisbegins with six representative issues, thereon which the author puts forward judicialrecommendations in the purpose of providing variety choices, including: the means ofacquirement on the qualification inheritance, the inheritance of the qualification andthe position, the qualification heritance of persons with incomplete capacity for civilconduct, the qualification heritance among many inheritors, derivative one-mancompany, the issue of qualification inheritance and shareholder’s pre-emptive right topurchase. In order to deal with the means of acquiring the qualification inheritance,the author points out the judicial suggestion on the basis of analyzing cases, andexpect to compensate for the lack of procedural requirements in the76th clause.The fourth chapter analyzes the approach of protecting the minority shareholders’right when the inheritor’s right of inheriting the shareholder’s qualification is excluded.The thesis suggests that the75th clause should add the contents of shareholder’s rightof rescission when the shareholders have inherited the shareholder’s qualification ofCo. Ltd, which aims to eliminate the conflict among different individuals.