Research On Damages For Non-fair Related Transactions

The liability of damage compensation for unfair related party transactions is the special liability for the breach of fiduciary duty. Damage compensation liability rules is one of the main ways of private law relief to related party transactions. Because of the gap-filling and ex post facto features, damage compensation is regarded as the last line of defense of the judicial remedy. In view of such a starting point, combined with the Corporate Law and the actual development of companies in Chine, this paper elaborates from 3 aspects:the company protection, the shareholder protection and the company's creditor protection. This paper analyzes the present situation and supervision of unfair related party transactions, expounds the nature and function of unfair related party transactions. This paper focuses on the compensation for damage of related party transactions caused by directors and executive officers, on the compensation for damage of related party transactions caused by the controlling shareholder, and on the compensation for damage of the interests of creditors of the company. This paper analyzes the fiduciary duty of directors, executives and controlling shareholders, evaluates "the system of piercing the corporate veil" in China, etc, in the purpose of further improving the liability system of Company Law, and providing reference and inspiration to solve the problem of unfair related party transactions.