Research On The Veto Right System Of Shareholders Of Limited Liability Companies

In the voting system of the shareholders meeting of a company limited,the voting right is usually exerted in accordance with the principle of "the same shares,the same rights" and "capital majority decision".In order to meet the developing needs of market economy,the system of veto right of shareholders has also emerged in practice.The emergence of veto right system breaks the principle of "the same shares,the same rights" and "capital majority decision" in the shareholders meeting,but the generation of rights are usually accompanied by the abuse of rights,and there is no clear provision for veto right in law.On this basis,this paper puts forward some suggestions on the use of veto right in practice by investigating the current situation of veto right.The first part of this paper the first is to define the shareholder's veto tight,and then is to investigate the current situation of the veto right of shareholders,and find out some situations that may lead to the abuse of the veto right of shareholders.The practical situation mainly includes: there is no limit on the number of people who have the veto right,there is no standard on the matters of the veto right,there is still a dispute on whether the veto right should exist in the board of directors,there is no deadline for the exercise of veto right,there is a conflict between the veto right stipulated in the investment agreement and the relevant provisions of articles of association.The second part of this paper is from the perspective of legislation and justice to find out the legal survival space of veto right,as well as the view point of the court to veto right.The third part of this paper is to compare the veto right with similar systems abroad,so as to better understand the veto right.The fourth part of this paper focuses on the analysis of the existing methods and ways of veto right.The first is to analyze the veto right in the shareholders meeting and the veto right in the board of directors,which considers that there is not sufficient reason for veto right existing in the board of directors.The second is to analyze theexistence of veto right in two different ways,the articles of association and investment agreement,and also analyze the relationship between the two ways of setting,and holds that in case of a conflict between the veto right in the investment agreement and the articles of association,it should be analyzed in detail.The fifth part of this paper is based on the analysis of the previous parts,and puts forward suggestions on the use and improvement of veto right.For the reasonable use of veto right,firstly,we should control the number of vote right,secondly,we should reasonably set up the scope of veto right,thirdly,we should make clear the rules for shareholders to exercise veto right.In the prevention of the abuse of veto right,we should first make clear the right boundary of veto right,then strengthens the fiduciary duty of the shareholders who have veto right,and finally improve the responsibility of the shareholders who abuse veto right.and finally,we suggest that the contents of veto right should be clearly stated in the regulations.As for the relief of abusing veto right,this paper first discusses the liability for breach of contract and tortuous liability of shareholders who abuse veto right,and then discusses the shareholder who abused a veto right after lifting the veil of the corporation should bear unlimited liability.