Research Of Several Law Issues Of Corporate Re-investment

After China applied reform and open policy, the development of China’s market economy goes in-depth. With the improvement of Chinese corporation system and the development of security market, more and more companies involving in holding other companies’ stock, mergers and reorganization of enterprises. Those economy phenomenons refer to the concrete forms of corporate re-investment, which is increasingly common and influence widely. Due to Chinese Corporation Law’s corporate re-investment policy deficiency, many companies’ legal persons’ economic behaviors are irregularity. Besides, corporate re-investment may bring law risks to company which cannot be controlled. Thus it is necessary to improve relative legislation to perfect the corporate re-investment law system.Even though corporate re-investment may produce some negative effects to company and society, corporate re-investment is necessary, which is the request of economy development and the important way to promote social economy development. It is significant to improve company’s flexibility, to add social assets liquidity and to form scale effect. Therefore, loosen the restrictions of corporate re-investment, make the system work, and sufficient restrict and prevent the possible risk. Efficient and security should be the goal and value of the Chinese Corporation Law. Compare to previous Chinese Corporation Law, our new Corporation Law is looser in corporate re-investment restriction and show more private autonomy in some extent than the previous Corporation Law. But in the new Corporation Law, the corporate re-investment law is too simple. There are many problems and argues need to be solved in the current law. To solve those problems in reality is in urgency. What’s worse, Chinese Corporation Law do not regulate the risks corporate re-investment may bring. Therefore, our corporate re-investment law cannot functional. Risks are adding in economy development in the mean time. This paper was mainly involving these three parts:First, the basic theory of corporate re-investment. On the foundation of sum up the corporate re-investment concept, this paper analyzed the economic necessary of corporate re-investment and the risks it may produce. Then the paper reviewed the development of corporate re-investment in Chinese Corporation Law. The induction and briefly analysis on the current Chinese Corporation Law made the foundation for the following recommendation of corporate re-investment’s problems and issues.Second, the problems and issues of corporate re-investment. This paper mainly discussed investment object, decision-making mechanism and the legal effect for break corporate re-investment law. Then summarized the Chinese Corporation Law’s regulation to corporate re-investment and clarify illegal corporate re-investment legal responsibility still existing flaw.Third, improve Chinese corporate re-investment system. This paper discussed the revision of Chinese corporate re-investment’s legislation value. Bring out that Chinese Corporation Law should follow trend of times. Chinese corporate re-investment should develop from simple regulation to synthetically regulation. Adjusting all the relationships that corporate re-investment forms. Strengthen the explanation and construction of corporate re-investment’s related law issues. Due to corporate re-investment may bring risks, while Chinese corporate re-investment deficient in risk regulation, this paper proposed four advices, which is perfect company’s information announcing system, restrict the proportion of cross-shareholding and voting power, form new debt repay system and improve the disregard of corporate personality system.