Perfection Of The Shares Repurchase System Of Limited Liability Company

In the latest amendment in 2018,the Company law of the People's Republic of China once again relaxed the conditions for the shares repurchase of stock limited company,and overall the shares repurchase system of stock limited company has been established and gradually improved in the Company Law.Comparatively speaking,the equity system of limited liability company is in the absence of the law,only article 74 of the Company Law stipulates the system of the right of objection to shareholders' share buyback of limited liability company,but this system is built on the protection of minority shareholders.The system is not same as the the shares repurchase system of limited liability company.Due to the absence of legislation and the different views of the academic circle,the judgment results are also inconsistent or even conflicting.Although the Supreme People's Court issued the Guiding Case No.96 to support the shares repurchase of limited liability company and reiterated the connotation of the system,Whether the repurchase violates the capital maintenance principle,the principle of equality of shareholders and other disputes were still not be replied.There are still many cases in practice tend to believe that limited liability company have no right to repurchase.In view of the fact that the shares repurchase can meet the company's many practical needs,it is necessary to respond to the effectiveness of the limited liability company's share repurchase and related disputes,and to build up the system.In order to comprehensively sort out and resolve the disputes related to the sharerepurchase of limited liability company,the article is mainly divided into the following four parts:The first part is to introduce the main situation of shares repurchase of limited liability company in judicial practice and the disputes arising therefrom.Through the combing of the opinions and reasons of the case referee,the two major disputes of the current limited liability company repurchase are summarized: First,the validity of the limited liability company's shares repurchase is controversial;Second,the relationship between the shares repurchase and the basic principles of Company Law.The lack of correct understanding of the relationship has led to the diametrically opposed view in judicial decisions.The second part analyzes the system from two angles From the perspective of legislation,first of all,through comparison,it is clear that the system is independent of the dissenting shareholder share repurchase claim system and the shares repurchase system of stock liability company.Therefore,the law of the latter two systems cannot be directly quoted.Secondly,from the theory of company contract,the theory of company autonomy and the characteristics of limited liability company,it is argued that the shares repurchase is in full compliance with the value orientation of the Company Law,and there is no need for legislation.Finally,according to the judicial interpretation of the company law,legislation already has provisions of the system.From the perspective of judiciary,it mainly analyzes the connotation of the principle of capital maintenance and the principle of equality of shareholders,and points out that the repurchase does not necessarily violate the basic principles of Company Law.The third part introduces the legal provisions of other countries,mainly enumerating the legislation of the three representative countries of the United States,Germany,and Japan.The legislative trend of the above-mentioned countries is“permitted by principle,exception prohibition”,and a set of systems is formed through the provisions of the decision-making body of shares repurchase,the number of shares repurchases,the source of repurchase funds,and follow-up treatment.Investigating the legislation of other countries is conducive to better constructing the system in our country.The fourth part is to improve the system from the procedural conditions and substantive conditions.In terms of procedural conditions,in accordance with the provisions of the company's articles of association,if the company's articles of association do not stipulate,the decision-making power will be handed over to the shareholders' meeting.The follow-up treatment of the shares repurchase must also be made clear in advance.At the same time,the company must strictly fulfill its information disclosure obligations.In substantive terms,the shareholding of the repurchase must have fully fulfilled the capital contribution obligation.The price of the shares repurchase is reasonable,and the repurchase fund must be the legally available after-tax profit after the withdrawal of the provident fund.