Analysis On Shareholders’ Rights To Inspect Books And Records

Because of the separation of ownership and management in modern corporatesystem, most shareholders do not directly participate in operating and managingprocedures. And that the company’s important information and core data are in thehand of the management layer, which results in the information in equivalencebetween shareholders and the management layer. Therefore, shareholders must have acomprehensive understanding of that information when they are to make majordecisions and safeguard their own interests. Misusing of those information advantages,the management layer might do harm to the company and shareholders, so theCompany Act gives shareholders the right to know. As an important component ofshareholders’ right to know, the right to inspect books and records is a possible accessfor shareholders to have a full picture of the company’s operating and financialinformation, and to oversee the management of company as well. The new CompanyAct of2005has further specified the provisions of the shareholders’ inspection right.However, these provisions are still slightly vague when they come to complexcompany disputes, which make us encounter a lot of controversial issues in practice.By introducing one real case, this thesis makes a systematic analysis of some commondisputes, and studies treatment methods and legal basis of extraterritorial legislates indealing with similar disputes. In addition, this thesis tries to offer a better way to solvethese disputes based on existing theory, and put forward the proposal to improve shareholders’ right of access based according to the previous approaches.This thesis isdivided into three parts in addition to the introduction and conclusion.The first part: Quotations on cases of shareholders’ inspection rights. Throughcase analysis, this thesis sums up controversy focus, and cites different rulings andtheir legal basis on the same problem in different courts. Accordingly, this thesisintroduces three common issues during lawsuits on the right to know.The second part: Issues of shareholders’ inspection rights. In this part, the authoranalyzes the following three issues:1) the shareholders’ qualification and the exerciseof their inspection rights,2) the identification of legitimate (proper) purposes ofshareholders’ inspection rights,3) the range of shareholders’ inspection rights, inwhich mainly discusses whether the original documents and accounting documentscan be included in the scope of shareholders’ inspection rights.The third part: Remedies on shareholders’ inspection rights. Not only aiming atissues above but also some other existing problems as well, this part tries to putforward some proposals to perfect shareholders’ inspections rights, such as expandingthe objective scope of inspection rights, assigning the burden of proof, specifyingprocedures of exercise and relief, introducing checking people system, specifyinglitigation liability, and so on.