A Study On The Conflict Between Equity Transfer And Equity Burden In Bankruptcy Reorganization Procedure

The bankruptcy reorganization refers to a procedure initiated by the application of debtor or the creditor to the people's court under the circumstance that a company is unable to repay the debt but has the hope of regeneration.Under the lead of the people's court and the participation of the interested parties,the company can reduce the amount of creditor's rights and introduce restructuring in accordance with the procedures stipulated by law.The statutory procedures for the overall adjustment of debt and the comprehensive adjustment of assets,equity,and business operations,such as the investor and the adjustment of the investor's rights and interests.The bankruptcy reorganization is a judicial rescue procedure for distressed companies.It enables distressed companies to restore their operating capabilities and profitability through various means,continue the corporate legal person qualifications,and continue operations,thereby maximally protecting debtors,creditors,and contributors.In combination with our country's many years of judicial practice,almost without exception,in the bankruptcy reorganization procedure,the rights and interests of the bankrupt enterprise's investors have been adjusted.The purpose of adjusting the equity of the reformer's contributor is to optimize the structure of the company's equity structure by adjusting the capital contribution structure,realizing the redistribution of the investor's rights and interests,and helping the company to obtain rebirth.In the process of adjusting the rights and interests of investors,equity transfer is one of the most commonly used methods.As the equity held by the investor of the reforming enterprise is often pledged to a third party or judicially frozen by the People's Court,the adjustment of the rights and interests of the investor through the transfer of equity will affect related rights holders' interests.Under such circumstances,the current "enterprise bankruptcy law" does not explicitly gives an solution to solve the conflict between equity transfer and shareholding burdens,and there are also many disputes in judicial practice.This article starts from the empirical case,sorts out and summarizes the general situation of reconstructing the contradiction caused by equity transfer and equity burden in the case,and analyzes the reasons for its existence.Through the analysis of the existing legal provisions and the experience of judicial reforming practices and the lessons learned from the extraterritorial legislation experience,the author believes that the reorganization plan can adjust the interests of the relevant rights holders guaranteed by the equity burden.If the relevant right holder refuses to perform the obligations set out in the reorganization plan,the debtor or the administrator may apply to the court for enforcement.However,in view of the fact that the current "Enterprise Bankruptcy Law" and the judicial interpretation clearly stipulate this,the author proposes to solve such conflicts through perfecting legislation or referring to other existing rules.