Study On Directors’ Call-up Obligations Under The Full Subscription System

The reform of the company’s capital system has been the expectation of the scholars in the field of corporate law since its revision in 2005.However,in the end,it was criticized by theorists because of its hurried release.The new "Company Law" not only changed the company’s capital registration system,but also revolutionized the way the company paid its capital.The "Company Law" relaxed the standards during the company’s establishment phase,but at the company’s operational stage,it did not strengthen the supporting legal measures for shareholders to pay.This brings institutional risks to the performance of shareholders’ contribution obligations.It should be pointed out that one problem that actually exists at all stages of the "Company Law" is the fulfillment of shareholders’ capital contribution obligations.Only under the complete subscription system,the problem is particularly obvious,and there are no corresponding supporting measures.Compared with partial subscription systems,the amount of initial capital contributions and the statutory capital contribution period of up to two years or five years(investment companies)are limited.There is a lack of legislation that urges shareholders to fulfill their capital contribution obligations under the full payment system.The response path proposed by the academic community either has no clear legal basis or there is a delay in the application of the law.It is based on such considerations that considering the interestsof shareholders’ term,the interests of creditors,the balance between the company’s overall interests,and the legal foundation,it is reasonable and feasible for the directors to fulfill their obligation of call-up for contribution.Then,we started to discuss the specific structure of the directors ’ call-up for contributions and the directors’ liability for breach of their call-up obligations.It should be noted that the directors’ call-up for capital contribution includes two situations: one is that the subscription capital contribution expires and the shareholders have not yet fulfilled their capital contribution obligationst,and the other is that the capital contribution period has not expired and the shareholders have not fulfilled their capital contribution obligations.This article mainly focuses on the second situation where the subscription deadline has not yet expired.First of all,although there are differences between the two situations,however,shareholders can strategically extend the subscription capital contribution period by amending the company’s articles of association,,which indirectly change the subscription period from expiration to non-expiration.Therefore,although the foregoing two cases,in fact,the former can be converted into the latter through procedural operations.If the latter’s systemic risk is solved,the former’s problems will naturally be solved.The first chapter starts from the capital system reform,then discusses the institutional risks of shareholder capital contribution obligations under the full subscription system,including the uncertainty in performance of shareholder’s contribution obligations,the unsatisfactory funding requirements of the company,and the unbalanced interest structure between creditors and shareholders.In order to break through the above-mentioned realistic predicament under the full subscription system and better urge shareholders to fulfill their capital contribution obligations,academics have proposed expedited expiry of lawsuits and accelerated expiry of bankruptcy.However,there has been debate between the two,and the former is theoretically Reasonable,but still can not eliminate its lack of a specific legal basis,the difficulty of judicial application and the latter there is a delay in the application.Therefore,the most urgent task of institutional design is to find a substitute path that is rational,legitimate,and feasible and follows the logic of company law.By learning from theUnited States "Delaware Common Company Law" and the The UK Companies Act,this article believes that directors’ fullfilling their call-up contribution obligation is a viable path for academic theories to "jump into" practice.The second chapter discusses the legitimacy of the director’s call for contribution obligation.The core question that needs to be solved is “Can we ask shareholders to pay in advance? ” According to the law,in the case of company bankruptcy and dissolution,the answer is yes.The question that needs to be discussed is whether the shareholder’s term interest can be deprived if the shareholder’s subscription of capital contribution has not yet expired.Therefore,this section gives specific explanations.Afterwards,analysing the legal basis of the director’s call-up obligation.The director’s call-up obligation is subject to the director’s duty of care and complies with the principle of corporate autonomy.The third chapter mainly elaborates the specific construction of the director’s call-up obligation,including the applicable conditions and specific procedures for the directors to fulfill their call-up obligation.It also pointed out that it is possible to learn lessons from foreign experience and establish a directors’ call-up procedure centered around the board of directors.The fourth chapter discusses the directors’ responsibilities.First,starting from the case presentation,introduce the directors’ responsibilities under different circumstances,and then emphasize the necessity of the existence of directors’ responsibilities.In addition,in order to supervise the directors to urge the shareholders to fulfill their capital contribution obligations,the directors’ liability for breach of the call-up obligation cannot be waived or restricted.