Fiduciary Duties Of Controlling Shareholders And Civil Liability For Breach Of Fiduciary Duties In Affiliated Transactions

Controlling shareholders can use their strong control and voting rights to exert a substantial influence on the operation and management of the company through the principle of capital majority rule.There are many cases that controlling shareholders abuse their control on the company.In the case of connected transactions,it is easier for the controlling shareholder to pursue private interests through the form of related party transactions.For example,the long-term occupation of company funds,transfer profits through affiliated transactions,etc.,Unfair connected transactions are often the result of controlling shareholders' abuse of control.In order to give full play to the positive effects of the affiliated transactions in promoting efficiency and reducing the transaction risk while not becoming a tool for controlling the shareholders to seek personal gain,it is necessary for the controlling shareholder to assume fiduciary duties including duty of care and loyalty,and provide relief to small and medium shareholders when controlling shareholders violate their fiduciary duties.Based on the four dimensions of subject,behavior,obligation and responsibility,the thesis can be divided into four parts to discuss in detail the fiduciary duty and the civil liability of the controlling shareholder in the affiliated transaction with the method of comparative analysis and empirical analysis:an overview of shareholders' fiduciary duties,the fiduciary duties of controlling shareholders in the affiliated transactions,the performance and criteria of fiduciary duties violated by fiduciary shareholders in the affiliated transactions,and what kind of liability controlling shareholders should take for violating fiduciary duties in the affiliated transactions.The first part introduces the connotation and specific regulations of the controlling shareholder,and then from the history of the origin and development of the controlling shareholder's fiduciary duties,explores the theoretical basis of controlling shareholders'fiduciary duties,thus forming the basic understanding.The second part elaborates the contents of the fiduciary duty of the controlling shareholder in the affiliated transaction,including the duty of care and the duty of loyalty.The third part examines the specific performance of the controlling shareholder violating the fiduciary duty in judicial practice,which mainly includes the occupation of company funds,the non-compliance requirements of the company to provide guarantee for it,the purchase and sale of products at unreasonable prices,inadequate or untrue information of the the affiliated transactions and so on.Then,it makes a comparative study of the judgment standards of the fiduciary duty in Anglo-American legal system,and summarizes and draws lessons from it so as to perfect the review standard in the affiliated transactions of Corporation law of China.The fourth part discusses the civil liability of controlling shareholders when violating the fiduciary duty in the affiliated transaction,analyzes the constitutional elements of the liability and the differences from the general tort liability.Finally,it analyzes the distribution of the burden of proof and the concrete realization mechanism of the litigation.