The Company Creditor Benefit Protection Under Subscribed Capital System

It has been an enduring and timeless topic to protect the interests of creditors since the Roman law appeared. When the company comes up, due to its unique design and broader participation in the market, the creditor protection is focused on national legislation and practice, and China is no exception. In addition to traditional protection, "Company Law" also set up a series of systems to protect the interests of creditors of the company, to a certain extent, at the expense of efficient way to maintain the security of transactions. December 2013, the "Company Law" revised cancel the registered capital paid-up registration system and establish a subscribed capital system to make an active market, but at the same time lead to social protection of the interests of creditors widespread concern. In this paper, at the perspective of the company to protect the interests of creditors, we analyze the new problem subscribed capital regime under the protection of the interests of creditors and proposed countermeasures. Besides introduction and conclusion, the article is divided into four chapters:The first part: The issue is raised. Because of the unique design of the limited liability company system, the shareholders are only responsible to its contribution, the business risks which can not avoid and eliminate are passed on the company’s creditors. Based on the interests of shareholders and creditors balanced idea, in order to protect the legitimate interests of the creditors of the company, "Company Law" was constructed based on a series of systems. December 2013 the "Company Law" establish a revised subscribed capital system to effectively promote freedom peddler, but due to the cancellation of the paid-up registration system, so based on creditor protection system which was abolished built. In the corresponding which supporting laws and regulations are not perfect, how to design scientifically and improve the company creditor protection system is a top priority.Part II: Overview of the company to protect the interests of creditors under subscribed capital regime. The first is to establish a capital contribution system. Capital subscribed by institutional review process established, clear subject scope of its application, analyze their progress and necessity established: a sense of credit from the capital to assets credit conversion; 2 Value by the security priorities shift priority to efficiency;. 3. The Government role from "omnipotent government" to "Service Government"; 4. Other countries provide a successful experience. Second is to protect the interests of creditors of the company to re-examine. The section on the basis of a brief analysis of the need for protection of the creditors of the company, pointed out that the paid-Registration System under creditor protection rules and regulations no longer continue to apply soil subscribed capital system established after expanding shareholder autonomy, to the benefit of creditors protection but no corresponding system design, status of the company to protect the interests of creditors worrying.Part III: The company creditor benefit protection under subscribed capital system faces new problems. This part is primarily based on the company’s set-up phase, the operational phase, exit stage different aspects to be addressed. First, the company pointed out that the establishment phase creditor protection system deficiencies: lack of protection of creditors’ right to know; the company’s property separate challenges. Second, it puts forward the operational phase creditor protection system figurehead: Penalty protection measures "in addition to punishment-oriented"; the principle of diligence obligations; Denial lack of suitable space system. Finally the company exit stage is difficult to perform a non-bankruptcy liquidation: creditor difficult to participate in the company of non-bankruptcy liquidation process; creditors can not be accurately informed dissolution time; forcibly disbanded too.Part IV: Several recommendations for the creditors of the company under the new situation.First, establish a sound credit system, including the establishment of a comprehensive and integrated enterprise credit system, improve enterprise credit information regulation and strengthen penalties for dishonest enterprise. Second is to strengthen the company’s management, including the reference cited "business judgment rule", the introduction of the company dynamic solvency testing mechanism, prudential rules applicable piercing the corporate veil, to establish a new way of debt guarantees. Once again, standardize its liquidation. Including the establishment of the dissolution announcement registration system, set up career liquidators system, weakening the administrative compulsory dissolution. Finally creditor to raise awareness and ability of self-protection, before providing debt financing careful review of the loan over a period of dynamic inspection, timely recovery after the borrower defaults.