Protection Of The Rights Of Minority Shareholders In Related Party Transactions With The Company Internal Governance

Related party transactions as a legitimate way to trade, it is to achieve lower costs for negotiations, reduce transaction risks, to achieve an effective way of balancing of interests. However, if a non-fair tendency, related party transactions will have an extremely negative effect. Will produce an extremely negative effect, it will not only lead to a deal between the independent subject evolved into a control self-dealing, but also lead to all shareholders including minority shareholders to make trading decisions controlled by the minority shareholders. These negative effects, the majority of minority shareholders because of their disadvantaged status and insufficient awareness of rights, the controlling shareholder of wanton behavior into a right can not exercise, enabling the pursuit of not, can not talk to bitter.Minority shareholders rights should be enjoyed by the minority shareholders as shareholders of the Company to obtain legitimate interests. This pursuit of the legitimate interests objectively contributed to the company’s production, development and growth.For the existence of a company can not be separated from the large shareholders of the dominant, is also inseparable from the participation of small shareholders. The largest shareholder is leading the development of business strategy, minority shareholders of its positive cry, which in itself is an extremely harmonious arrangement. However, in reality, is not the case, despite the shareholders’ right to equality of shareholders to enjoy, but for the large shareholders and minority shareholders, the options were exercised the degree and the violation of the relief situation has completely difference. For large shareholders, affairs of the company has the right to basic decision-making and guide the company, their rights are very rare for a violation of terms of the minority shareholders. But for the small shareholders of their rights suffered a major shareholder in violation of the status of a more frequent trend.Connotation of the small shareholders’ rights protection is not only national, government and law from formally joined the company and leave the company to provide the freedom and convenience of the system, from essentially improve the internal governance and external governance, to ensure that minority shareholders in shareholders during the rights can be fully realized, can be fully make up for their rights have been violated. The former is a form of power protection on the content, the latter is the real significance of the protection of the rights embodied. The protection of the rights in the form of sense is very important in the early development of the company, shareholders today to join exit mechanism is formed in that period. However, with the further development of society, today the formal sense of equity protection can no longer meet the needs of practice, people’s vision with more on top of its real meaning.China’s regulations on the protection of the rights of minority shareholders for shareholder rights protection in China plays a big role. However, on the one hand, the introduction of the "Company Law" for the United States and Europe late, many of the provisions are not copy of its not entirely suitable for China’s internal corporate governance status. on the other hand these provisions in the corporate governance in China the implementation of the practice also has much to be desired, of which, such as:the specification of the shareholders’ obligation of good faith object too generalization; cumulative voting system needs correction; voting rights system needs to be re-structure, and so on. Optimize the company’s internal governance system of minority shareholders in corporate governance, introduce and draw on good governance, the adoption of a variety of well-established rules to protect the core of the way.