The Analysis Of Pros&Cons Of U.S. Limited Liability Company And Legislation Of China Limited Liability Company Act

US limited liability company (hereinafter referred to as: LLC) is a new form ofbusiness organization, which includes the characteristics of limited liability, flexiblemanagement and partnership tax status (non-double taxation treatment). For theseadvantages, LLC was popular to the small and medium-sized enterprises andflourished. Statistics show that more than ninety percent of U.S. small andmedium-sized enterprises registered as LLC. Since LLC is helpful to promote thedevelopment of small and medium-sized enterprises and enlarge employment, manycountries and regions are researching on legislation of Limited Liability Company Act.Chinese scholars on commercial law are also interested in this issue and did a lot ofresearch on whether it is available of legislation of China Limited Liability CompanyAct. This paper will analyse the pros&cons of U.S. Limited Liability Company andlegislation of China Limited Liability Company Act and consist of three parts asfollows:Part One, Brief Introduction of U.S. Limited Liability Company. First pointintroduces the concept and history of LLC. Then, second one introduces the legalcharacteristics of LLC. Lastly, the analysis of pros&cons of U.S. Limited Liability Company Act. This part is the basis of this paper.Part Two, Institutional Demand of Small and Medium-sized Enterprises in Chinaand The reason of Legislation of China Limited Liability Company Act. First pointintroduces the concept of small and medium-sized enterprises. Second pointintroduces the institutional demand of small and medium-sized enterprises. Thirdpoint is the comparative between China’s business organizations and U.S. LLC.Fourth point introduces the reason of making China Limited Liability Company Act.Part Three, Taking Three Steps to Make China Limited Liability Company. Firststep is to improve the existing China business organization with the element of U.S.LLC. Second step is to improve the system of Pierce the Veil of Corporation andapply this system to LLC. Third step is to make China Limited Liability CompanyAct.