The Research Of Withdraw Paid-up Capital Contributions From A Chinese Company Law Perspective

Recent years have witnessed a debate over withdrawing paid-up capital contributions in China's law practice.With the waiving of the minimum capital requirement in the new Company Law enacted in 2013,withdrawing paid-up capital contributions can not subject to the companies which applied “subscription capital system”.As a result,shareholders may not withdraw paid-up capital contributions as the company can set up with very low capital.Some experts further argued that withdrawing paid-up capital contributions should be replaced by embezzlement of company property.Judicial interpretation(?)of PRC Company Law states some circumstances of withdrawing paid-up capital contributions which means it remaining a tricky question in practice.So the author summarized the rules concerning withdraw paid-up capital contributions and their developments under PRC legal regime and found out some remained questions.In order to resolving these questions,the author turned to the European Company Law which served as the source of modern company law.Chinese Company Law was also based on it.The source may provide us an original structure of withdraw paid-up capital contributions.With the research and analysis of European Company Law(mainly the British Company Law),China's withdrawing paid-up capital contributions is the equivalent of returning property in European Company Law.Further,it served as a part of Capital Maintenance principle.After the legal analysis,the recognition of withdrawing paid-up capital contributions is of the essence.The author applied the balance sheet to recognize the ways of withdrawing paid-up capital contributions and differentiate it from illegal distribution.In turn,this article presented a clearly structure of withdrawing paid-up capital contributions.