Research On The System Of Equities Alteration Of Foreign Capital Enterprises In China

In the early days of the reform and opening-up, we introduced foreign-capital to promote economic development. In order to cater for foreign investors’ coming, our country legislated for the first Law of Foreign-capital Enterprises, while private rights showed excessive intervention to the market and we knew few about foreign investors. Until this point, our country even had not published corporate law suitable for the economic situation. More and more foreign investors have chosen to invest in China since our country joined the WTO. As the optimization of China’s foreign investment environment, foreign-owned enterprises showed more and more structural adjustment frequently. Increasing number of problems revealed in practical operation, especially upon the equities alteration in foreign-capital enterprises. In consideration of foreign investors’special status, the equities alteration in foreign-capital enterprises not only affects the interest of the stock owners, but also affects the enterprises’ development prospects. Moreover, it may even affect the stability of economic order.In our country, the equities alteration in foreign-capital enterprises encompasses complex legal relationship. It not only contains administrative approval, but also relates to the agreement of parties involved in the equities alteration, and the enterprises’ fund flow. Meanwhile, it refers to the connection of many different government departments, such as the Department of Commerce, the AIC, the Department of taxation, the SAFE etc. However, our foreign-capital enterprise legal system is still in lack of clauses referring to equities alteration, and different departments do not have sufficient coordination. Therefore, the strengthening of supervision on equities alteration in foreign-capital enterprises and the improvement in legislation, will effectively guarantee the operation of foreign-owned enterprises under the existing economic system. Simultaneously, it will promote healthy and orderly development of the market economy in our country.Well-worked legal environment is an important sector in promoting economic development. The problems revealed in the legislation of equities alteration in foreign-capital enterprises, allude to the numerous and repetitious of the existing foreign-capital enterprise legal system in our country. Nowadays, has been kept up with the times and showed continuous improvement. The contradictions between three laws for foreign-capital enterprise and the Company Law are highlighted gradually. To reconstruct foreign-capital enterprise legal system and make it more suitable to connect the Company Law is not only the guarantee for attracting investment smoothly and foreign-capital enterprises’ healthy development, but also an important means to promote the smooth transition of economic structure and to integrate with the world economy. Be fettered by the data and my own capability, this article mainly sorts out some relatively common problems on equities alteration in foreign-capital enterprises and study these problems from practical operation in registration and legislative improvement.