Legal Mechanism Of Minority Shareholder's Withdrawal In Merger Of China

Cases about Merger are becoming more and more serious in our country recently,which are always accompanied by complicated relations and make important influences on the protections of shareholders and the development of companies.Now,most researches of our country focus on the “Entrance”,which are about the legal control of merger conditions,legal restrictions of corporation articles,etc.But because of the doctrine of overwhelming majority capital,controlling shareholders may deprive the minority shareholders of their rights through the process of merger.So the “Exit” is the more key to protect minority shareholders.We need to establish and perfect the legal mechanism of minority shareholder's withdrawal.On one hand,it is a way to provide the redress system to protect the shareholders from withdrawal.On the other hand,it is a way to optimize the allocations of resources for corporations.During the normal merger,even though the minority shareholders of Target Company and Surviving Company will become the victims because of the doctrine of overwhelming majority capital,they still have the chances to keep their shareholder's status.They can leave companies through the appraisal rights of dissenters and achieve the cash compensations.But,the Article 74 and Article 142 of our Corporation Law regulates the appraisal rights very simply.It is hard to operate and still have a big room to perfect.While,in the freeze out merger,minority shareholders of Target Company lose their share status and the shareholders of Surviving Company hardly have the appraisal right.They are both negatively affected by this way of merger.So it is very important to legally regulate freeze out merger for the protection of minority shareholders.In view of the legal mechanism of minority shareholder's withdrawal in merger,this paper analyzes every aspect from theory to laws,from abstract to specific and through domestic to overseas.Part One analyzes the minority shareholder's withdrawal in the background of merger,which expounds the jurisprudential basis of the appraisal rights of dissenters in normal mergers and the necessity to introduce freeze out merger in our country.Part Two is based on our laws from zero to one.This part shows the existing regulations of appraisal rights and freeze out merger,which exposes the problems of these regulations.Part Three reviews the regulations of U.S.and analyzes the reference to our country through these values,functions and standard for examining validity.The Last Part provides the advices to perfect the minority shareholder's withdrawal in merger.On one hand,this part analyzes the potential explanation of the existing laws of appraisal rights.On the other hand,this part proposes the introduction and creation of freeze out merger.