Studies On Protection Of Minority Shareholders Of Subsidiary In Corporate Groups

In modern society, the organizational form of corporates are beyond the traditional singlecorporate mode, to take the collectivizational and transnational road. The corporate group canexpand the company’s business scale, reduce transaction costs and risks the company operatingthe scale at the same time, also to reduce risk and cost, and also enhance the marketcompetitiveness of the company. However, there is a huge challenge to the traditional companylaw theory comes from the phenomenon of corporate group. Due to the existence of a conflict ofinterest between controlling corporate and subsidiary corporate, controlling corporate always usethe privileges of control to interfere management decision of subsidiary corporate, even damagethe legitimate rights and interests of the subsidiary corporate and its minority shareholders. Dueto the limitations of the traditional company law, the current legal system can not providecomprehensive and effective protection for the subsidiary corporate and its minority shareholders.Therefore, Chinese laws need to be improved in the view of specific characteristics of corporategroups. Based on the above, this paper from the angle of view of Company Law, through thecomparison and reference of the foreign experience in the relevant legislation, combined withChinese present situation of company development and existing laws and regulations, to offerproposals for construction of legal protection system of minority shareholders subsidiarycorporate in China.This paper is divided in five parts expect foreword and conclusion.Part one, introduction. In this part, first gives the definition of the related concepts involvedin the study, especially the detailed explanation about the connotation of "control", and thenreviews the present research status of the protection of minority shareholders’ rights in subsidiarycorporate, and citing the research framework and ideas of this paper.Part two, protection of minority shareholders of subsidiary corporate under the backgroundof corporate group. In this part, first analyses the present situation of the harming of the rightsand interests of minority shareholders in subsidiary corporate, from two aspects which iscorporate group formation stage and daily management stage, then based on the traditionalcompany law theory to discuss the dilemma of theory behind the phenomenon. Part three, the present situation and problem of our country’s legislation about the protectionof minority shareholders in subsidiary corporate. In this part, first analyses the present situationof our country’s legislation about the protection of minority shareholders in subsidiary corporate,and then points out the problems exist in the present protection of the rights and interests ofminority shareholders in subsidiary corporate.Part four, comparison and reference of the protection mechanism about the minorityshareholders in subsidiary corporate. In this part, selects the representative countries’ legislationand practical experience about protecting the interests of minority shareholders of subsidiarycorporate in two legal systems, and makes comparison and analysis.Part five, the reflection of improving the protection mechanism about the minorityshareholders’ interests of subsidiary corporate in our country. In this part, from the angle ofspecific legal system design, first selects the legislative mode, then put forward specificmeasures and recommendations from the two aspects of substantive law and procedural law.