The Research On The Application Of The Doctrine Of Substantive Consolidation In Associated Companies' Bankruptcy

As a new company organizational mode,associated companies can reduce transaction costs and business risks,and it also can improve the competition of enterprises and economic development.However,it also poses challenges to Chinese traditional legal system.The complex organizational forms and frequent internal transactions among associated companies provide the conditions for companies to transfer and conceal funds.Since the bankruptcy of associated companies are easily influenced by the actual controller's will,it is easy for them to control the companies to obtain improper benefits.However,this is not conducive to the protection of the interests of creditors.The individual bankruptcy principle in traditional legal system is unable to solve this serious problem.The doctrine of substantive consolidation originated in the United States,resolves to merge all or part of the members of associated companies into one juridical entity.Consequently,the company's assets and liabilities are combined into the same entity.After eliminating,the debt of the internal members,the assets,as a whole can be used to pay off the distribution of bankruptcy property,in order to achieve fairness and justice.There are many cases in the judicial practice of our country,The academic circles have done a lot of discussion,the doctrine of substantive consolidation,which plays a more and more important role in associated companies bankruptcy cases.However,it has not been established by the legislation of our country yet.This thesis discusses the deficiency of legislation of enterprise about the existing legal system.By referring to legislation and practice abroad,it puts forward some suggestions of perfecting legislative style and specific application conditions in China.