A Study On The System Of Expulsion In China

Shareholder expulsion system is an important system in modern company law. Although countries around the world have already made rules of the system of expulsion, but the provisions of the system in our country started lately. There are many problems in the existing provisions of the Company Law.The system of expulsion is the relatively strict punitive action to the shareholders, when they violated the obligation of good faith, and has a harmful effect on the development of the company. Therefore, the system of expulsion, firstly make other integrity shareholders’ interests are not damaged; Secondly, it further protect the trust relationship between the shareholders, to break the company deadlock, and companies can continue to develop business; Finally, through the company’s steady development, the system brings a lot of power for the harmonious and stable development of social economy, to ensure the judicial authority to a certain extent. But the system has not been able to get established in the Company Law in our country, also to some extent, reflects the legislators’ worry about conflict with other existing system in the Company Law, such as the capital system of the company. Shareholder expulsion system, however, not only would not shake the capital system of company, on the contrary it is a complement to the system, and can maintain the stability of the company. The existing system of the Company Law unable to effectively solve the deadlock situations of company with Individual shareholders’ dishonest behavior, when the shareholders infringe on the interests of the shareholders and the company. The system of expulsion will become another effective way of protecting shareholders’ rights in our country. Once the fear is eliminated, the system of expulsion will soon have been established in our country. The system of expulsion firstly is made in the third rules of some issues of the applicable of the Company Law of the People’s Republic of China made by the supreme court of people in 2011, with the reasons, the program, the protection of the creditor, and many other aspects. In practice, there is some change both in the case about the liability of defective capital contribution and the basis of the judge of expulsion. Of course, there are some disadvantages at the beginning of setting up the system of expulsion, for example, applicable scope of the system of expulsion is too narrow, and the lack of shareholder expulsion procedure and legal consequence. Although the existing provisions are not comprehensive, also there are some difficulties in practice, but we can’t ignore the reasonable place. We should make the rules of the system of expulsion in five aspects, as dismissal subject, reasons, dismissal procedures, consequences and the remedy of the shareholder’s right. We should balance the interests of all parties and learn from other countries and regions’ rules which have mature regulations and other relevant provisions of the law in our country. Not only ensure the system of expulsion can be implemented to the collective interests of the company and the shareholders can be maintained, and also protecting from the abusing of the rights.