On Preemptive Rights Of The Shareholders In LTD

The equity transfer in Limited liability company is the most important economicactivities in company operation. It is also the important form of collecting capital andoptimizing resources. Preemptive Rights of the Shareholders system has always beenan important theoretical practical issue and is also with "human" attributes of a limitedliability company in Chinese characteristics. This article is divided into three parts toillustrate the system:The first part deals with the definition and properties analysis. Firstly, deeplyimpressed by its definition, the author has induced this system from the horizontal andvertical system by comparing with the definition and scope of Chinese and foreignlegislation and elaborating different countries stipulations. And then by analysis of thetheoretical basis, property, Chinese related laws and regulations as well as furtherpurpose of this system, especially in three aspects argument of the nature, the authorhas pointed out the essence of "restricted free transfer" which is the basis ofanalyzing and understanding the conditions below.The second part exercises its conditions analysis, which mainly focuses on twokey aspects: main body condition and the precondition; Due to lack of the lawstipulation, the author puts forward its own views through the main body introductionabroad as well as the Chinese law legislation and the law and practice combination.The author has made value analysis and put forward views for "consent system" bycombining with its law and judicial interpretation analysis and practical process in theway of using of two or more legal subjects comprehensive analysis. For example," half agree" vote standards;"Written form" as to its specification of the carrier and thedefinition of content;"As agreed" in the terms and conditions of the purchase "shouldbe" and "don’t agree to buy share problems” such as a reasonable time.The third part is involved in its special problems and practice cases."Equal terms" is involved the content and theory analysis. The current simplelegislation and judicial interpretation provisions lead to the judgment of trial for"equal terms" to rely on the discretion of the judge. As to complicated situations inpractice, from the "simple and complex conditions" and "special circumstances" view,the author has analyzed specific case by using the way of “relatively equal”.Particularly, the author has presented a "special case" principle:"personal purpose"and "follow the objective cause”.For" the partly exercise of this right ", the author expresses denial attitude bycomparing the china-Germany legal provisions and focusing its really reasons. Themajor reason: In violation of the" equal terms "; Damage to the essence of theshareholders and the third party rights; Practical operation.The effectiveness of shareholders preemptive right specifically has illustrated itsconnotation and the type and effectiveness of violation of preemptive right and casestudy. Combining with the court and judicial interpretation, the author has comparedthe various legal effects as well as its advantages and disadvantages. According to thedifferent situation,“exit theory""invalid theory "and" validity theory " can be appliedto violation of preemptive right with the specific case analysis, such as be consideredas invalid:"the bund stakes" equity transfer case; Also the author has put forwardthe method of the comprehensive cognizance of contract effectiveness.The final conclusion part proves out the defects of the system of preemptive rightand suggestion: its provisions in procedure and entity, relatively simple. Therefore thereality and theory in this system should be improved.