On The Undertaking Of The Pre-incorporation Contracts’ Obligation

Making breakthrough on the dilemma of pre-corporation contract’s obligation’sundertaking is both complicated and significant. It is complicated because thepre-incorporation company is a temporary organization,during which its legal statusvaries greatly from time to time; Also, balancing the interests of promoters,pre-incorporation companies and the relative contracts is a demanding task. For quitea long time before the issue of the3rdjudicial interpretation of corporation law,thelack of relative statutes endangered the implement of the operation of economic life.Even though the judicial interpretation helped to tackle this problem, some issues arestill left to be solved.This paper values the statues in Chinese Corporation Law by comparing the theoriesin continental law and Anglo-American law system. Also, answering questions suchas: whether the pre-incorporation company can independently bear the responsibilitiesof the pre-incorporation transactions or not; should the promoters be bonded by thesetransactions or not; and how can the corporation bond itself to these pre-incorporationtransactions?the first chapter lies the understructure of the whole paper,by making definition of the pre‐incorporation contracts from the angles of time span and the contract’s contents.The character of personal combination and property basis lead to the opinion that:The corporation by‐laws and the subscription of the shares mark the beginning of the corporation’s formation.Also, this chapter discusses the four subjects of pre‐corporation transactions.Archly, studying the pre‐incorporation company’s qualification of civil subject.The second chapter relates and analyzes the liabilities of the promoters. To be morespecific, four classic kinds of liabilities,namely:the personal liabilities of thepromoter when he conclude the contract in his own name;the supplementary joint liabilities when the pre-incorporation company fails to fulfill the obligation underthe contracts;the unlimited joint liabilities when the company fails in theestablishment; the contract liabilities when promoters misuse their authorities.The third chapter probes into the validity of contract concluded in the name of thenon-existent company and the pre-incorporation company.Then discusses therationality of responsibility bearing by the pre-incorporation company.The last section sums up patterns for the company to inheriting the contractliabilities. First discussing how and why the company finally become one with thepre-incorporation company.Then inducing three main technique means for thecompany to bond itself to the pre-incorporation transactions originally bonding thepromoters.