On The Improvement Of The Subject Of Derivative Litigation

Derivative litigation plays an irreplaceable role in improving corporate governancesystem and in protecting the rights of stakeholders. Since its birth, it receives moreand more attentions in many countries, and also continues to develop. China’sCompany Law has absorbed the advanced experience of foreign countries and broughtin the system. However, the provisions of this system is incomplete, there are manyquestions to be worthy of further discussing. In particular, about the provisions on thesubject of derivative litigation, there is a large loophole. Based on a comprehensiveanalysis of the main problems, this article is to give some advice on the improvementof the subject of the derived litigation.This paper divides into three parts: the introduction, the body and the conclusion.The introduction analyzes the problems from our country’s existing regulations andresearch status at home and abroad, clarifies the object of this paper and illustrates thereasons for choosing this topic.There are three sections of the body.The first chapter mainly discusses the improvement of the plaintiff’s qualifications.At first, that the defects in the current regulations of Company Law are pointedout. And the mail defect is that workers of the company, bank creditors andbondholders are not be the plaintiff. Then the paper analyzes the reasons of suchprovisions in Company Law from the following aspects, including the constraint ofshareholder supremacy theory, the limits of the traditional party theory in Code ofCivil Procedure, the theory of stakeholder, the neglect of “Contract theory” in Law andEconomics and the excessive fear of malicious Litigation. Finally, correspondingimprovement measures are put forward.The second one discusses the improvement around the qualifications of thedefendant. Firstly, the basic principles of establishing the qualifications of thedefendant are pointed out. There are some defects in the current provisions ofderivative litigation from the perspective of the basic principles. The main defect isthat the scoop of the defendant is too broad. Then, the cause of the problems areanalyzed from threes aspects, including our country’s legislative practices and impactof legislative technology, the unclear understanding of the functions of derivativelitigation and overcorrection to company executives. At last, the conclusion is madethat our country should make a restrictive interpretation and should strictly limit thescope of the defendant.The third discusses the company’s position in the derivative litigation. Firstly, thispaper analyzes why our country does not make the provisions of the company’sposition in the derivative litigation from inadequate preparation of theories and ourcountry’s traditional practices “pay more attention to substantive law and seriouslyunderestimate procedural law”. Then, this paper is to analyze the necessity of the company’s participating in the litigation, and is to make the conclusion that thecompany should be given to the position of no independent claim of the third Party,but should also be made of its restrictive provisions, in order to better play its role.The conclusion part of the paper is summarized, explain the main points of thisarticle and the possible inadequacy of the main points.