Research On The Identification Of Legitimate Purpose For Shareholders To Exercise The Right To Consult Accounting Books

In the governance structure of modem companies,it is particularly important to ensure that shareholders know about the companyls operating conditions,because it is related to the realization of shareholders' right to know and the premise for shareholders to further exercise other rights.Accounting books,as the most comprehensive,accurate and true important materials reflecting the company's operating conditions,are the key to ensure that shareholders have access to the company's information.However,accounting books and other documents are at the core of the company.Improper access to accounting books by shareholders may affect the normal operation order of the company,or even reveal the company's business secrets,thus damaging the interests of the company.Therefore,article 33(2)of the current company law takes the legitimate purpose as the limiting condition for the shareholders of limited liability companies to inspect the accounting books in order to controls the adverse effects that may be brought to the company by the shareholders' inspection,so as to balance the interests between shareholders and the company.However,legitimate purposes is a subjective term,and there is no standard forjudging,which leads to the lack of unified standard in practice.Therefore,it is very important to further clarify the standard of legitimate purpose.This paper discusses the identification of legitimate purpose.The article is mainly formed of five parts besides the introduction part.The first part is to ask question.The basic case,the focus of the dispute and the reasons for the judgment of the dispute between Xu and Jiangsu A company show that it is difficult to determine the purpose of shareholders' access in practice,which is caused by the lack of the connotation of the legitimate purpose and the omission of the rules in the judgment of the legitimate purpose.The second part is the discussion of shareholders' right to consult accounting books and limitation of legitimate purposes under the consideration of interest balance.The right to consult the accounting books safeguards the rights of shareholders.Due to the conflict between the interests of the company and the shareholders,the legislation sets restrictions on the right for legitimate purposes in order to avoid damage to the interests of the company.The third part is the analysis of the causes of the plight of the legitimate purpose of shareholders' right to consult accounting books in judicial practice.In judicial practice,the result of the dispute of shareholders,right to know often leads to the imbalance of interests,which is caused by the over-emphasis on the protection of shareholders,interests,the lack of the connotation of legitimate purpose and the inoperability of improper purpose clauses in legal rules.The fourth part is an empirical analysis of the judicial cases of the shareholders'right to consult accounting books for legitimate purposes.In 80 cases,most of the inspection reasons of shareholders are summarized as "understanding of the company's operating conditions",and no specific reasons and specific purposes are proposed,resulting in the difficulty in the examination,and it is difficult for the company to exclude the inspection requirements of shareholders through the defense of improper purposes.The fifth part is the entity requirements and distribution of burden of proof for the proper purpose of shareholders' right to consult accounting books.The inherent requirement of legitimate purpose should be grasped from three aspects:necessity,legality,rationality.The common types of legitimate purposes include understanding the operating conditions of the company under relevant conditions,determining the value of shareholders' equity,investigating the dereliction of the company's management and exercising other shareholders' rights.Improper purposes include seriously anffecting the normal operation of the company,not for shareholders' own legitimate interests and against the company's trade secrets.In terms of distribution of burden of proof,shareholders bear the burden of proof for legitimate purposes,while companies bear the burden of proof for shareholders with improper purposes.The standard of proof of the former is lower than that of the latter.