Study On The Application Of The Disregard Of Corporate Personality System In China

The modern corporate system has two basic characteristics: the company has theindependent personality and the shareholders bear limited liability to the amount of paidcapital, forming benefit balance system of companies, shareholders and creditors, increasingthe stability of the market, investment promotion and promoting social development toachieve fairness as well as justice. But with the abuse of shareholders’ limited liability, theindependent personality becomes firewall (or veil) between the shareholders and the creditors.The shareholders use the system to infringe the interests of the creditors and the society,leading to imbalance of the original balance system. But based on this firewall (theindependent personality of corporation), blocking the creditors of the company to investigatethe abuse of the company personality of the responsibility of shareholders, causes that thecompany legal person system deviates from the goal of fairness and justice in law. For thegoal, the western law men created the company legal person personality denial system, whichuncovers the veil and gives company creditors the right of direct recourse for theshareholders’ liability, to maintain the company legal person system, restore unbalancedsystem, and realizes the fairness as well as justice.Although corporate legal person personality denial system has been established in thewestern countries more than100years, until2005, China set the system in the newly revisedCompany Law, indicating further improvement of the company legal person system in ourcountry. As a relief system, the legal system is suitable for life, but our company law is inprinciple, resulting in the problem of difficult application. Based on the basic theory of thesystem, this article explores the application of company juridical person personality denialsystem in the perspectives of general situation of our country’s development, problems ofsubstantive law and procedural law issues and other aspects.The article is divided into five parts.The first part introduces the company legal person system, analyses its defects, and thenintroduces the produce of corporate legal person personality denial system and its basicfeatures and value, and finally through a comparative analysis of two systems, analyses thesignificance of application of disregard of corporate personality system.The second part introduces the two law systems on how to apply the system of denying personality theory, to make theoretical basis for analysis of the system’s application in China.The third part introduces the application background of company legal personpersonality denial system in China and China’s new legislation of the system, to makepractical basis for the analysis of the system’s application in our country.The fourth part analyses the problems of system’s application in substantive law in ourcountry from the application principle, elements and application effect in combination of ourcountry company law and application theory and finally puts forward some suggestions forimprovement.The fifth part analyses the problems of the system’s application in China and ways toimprove emphatically from the perspective of procedure law, recognizes the need forimproving procedure law, from the significance of the realization of justice in procedural lawto the realization of justice in substantive law, and puts forward suggestions for application inour country combined judicial practice and specific national condition..