On Identification Of The Corporate Opportunity

The identification of the corporate opportunity is one of theimportant subjects of the Corporate Opportunity Doctrine. The emphasisand difficulty of the Corporate Opportunity Doctrine often lies in howto identify a business opportunity shall belong to the corporate ratherthan to a director. However, the identification of the corporateopportunity should adopt what kind of standard is also controversial evenin the case-law counties that the Corporate Opportunity Doctrine is moreand more mature. In2005the corporate law of our country introducedCorporate Opportunity Doctrine. Although it enriches the system ofdirectors’ duty of loyalty to a certain degree, there are also manyshortcomings. In particular, it lacks the affirmation standard of thecorporate opportunity and the exceptional provisions of the corporateopportunity are not comprehensive enough, which make the rules bedeficient in fundamental operability. Therefore, this article attemptsto explore a rule about the identification of the corporate opportunitythat fits into our national conditions by comprehensively using of variousresearch methods and referencing the United States, Britain and othercountries on the basis of legal theory.This article consists of Introduction，Context and Conclusion. Thestructure of the context is that: The Chapter One is an overview of the connotation and extension ofcorporate opportunity. On the one hand, from the angle of its connotation,the chapter will introduce the concept and the characteristics ofcorporate opportunity, as well as a tentative analysis of its legalquality. On the other hand, this chapter will expound the extension oftwo kinds of classification of the corporate opportunity which are matureand immature corporate opportunities and favorable and unfavorablecorporate opportunities, in addition, it will also emphasize the meaningof distinctions.The Chapter Two is a detailed discussion on the affirmation standardof the corporate opportunity which is the core proposition of CorporateOpportunity Doctrine. First of all, this chapter will introduce thedevelopment of the affirmation standard in the case-law counties, whichgraduates from the single standard, such as Interest or expectancy test,Line of business test, Fairness test, to the mixed standard, such asTwo-step analysis, ALI test, Clark test. Then through comparativeanalysis, it will extract the key points in different standards that areinstructive and useful. Finally, in the process of perfecting the Interestor expectancy test, together with the integration of merits of Line ofbusiness test and other tests, this Chapter will proposed a new test forthe affirmation standard of the corporate opportunity which calledInterest and Contingent Interest test.The Chapter Three is on exceptional provisions of the corporateopportunity. This chapter will analyze on non-determined opportunity,waived opportunity and non-performing opportunity, aiming at uniting theconvenience of use of the corporate opportunity and the Directors’ Dutyof Loyalty. At the same time it will stress that the legitimacy of theprocedure is the premise of the exceptions of corporate opportunity whichcan not deviate. The Chapter Four is about how to fill the holes of the corporateopportunity. The chapter will analyze on the actual situation and theproblems existing in the affirmation standard of our country from theperspective of the legislation and judicial application, and furtherprovide some relevant suggestions about the construction of affirmationstandard of the corporate opportunity and the perfection of exceptionalprovisions.