Research Of The Expulsion System Of Defective Contributed Shareholders

Because of the Companies Act explicitly provides for installment payment of the capital system, there is a serious discrepancy between fully funded actually and the obtainment of shareholders eligible. Due to it, more and more disputes are caused and thus there is a necessity to introduce the expulsion system of defective contributed shareholders. The establishment of the expulsion system of defective contributed shareholders in our country is in the infancy. Though the theory academia has researched gradually, there is a variety of different perspectives. And Chinese relevant laws are unable to meet the practical requirements of the judicial practice, owing to a serious lack of legislation. So on the basis of existing theory and practice and foreign mature theories and legislative experience, it explores issues of the expulsion system of defective contributed shareholders.This paper consists of three parts.Firstly, defective contribution and the expulsion system of shareholders. In a broad perspective this part defines the defective contribution. It discusses the definition and characteristic about the expulsion system of shareholders. At last, it acknowledges that defective contribution is applied to the expulsion system of shareholders.Secondly, the necessity and feasibility to build the expulsion system of defective contributed shareholders in our country. It will protect funded company, integrity shareholders and creditors from being harming. Then it introduces shortcomings of our legislation about the expulsion system of defective contributed shareholders. According to these sections, there is a necessity to introduce the expulsion system of defective contributed shareholders. And because other countries and China have researched the theory gradually, there is a feasibility to construct the expulsion system of defective contributed shareholders.Finally, advices about building the expulsion system of defective contributed shareholders.The substantive requirements of expulsion system of shareholders must consider the fact and subjective elements. On basis of these above, some can suspend to removed. The procedural elements of expulsion system of defective contributed shareholders include the notice procedure, and de-listing procedures and judicial relief program. As the front program of the system, the Board of Directors exercise urgency right. The subject’s delisting procedures are divided into a judicial nature and non-judicial nature procedures, and it clarifies the ownership and exercise of the rights. Taking into account of the interests of both sides, the judicial relief program needs to innovate on the basis of the current Civil Procedure Law.The legal consequences about the expulsion system of defective contributed shareholders is the flaw shareholders’ qualification loss, but the economic value of capital contributions that the flaw shareholders have paid actually does not disappear, empathy, a civil liability of the shareholders dose not disappear, the removal should continue to be liable to the relevant subject.