A Study On The Legislation Of Debt To Equity Conversion Under Bankruptcy Reorganization

In recent years,the pressure of global economic downturn has increased,and China's economic situation is facing a critical period of "three phases superposition".In December 2015,the central economic working conference made a comprehensive deployment of five major policies,including macro policy to be stable,industrial policy to be accurate,micro policy to be active,reform policy to be practical,and social policy to be underpinned,with emphasis on "three go,one drop,one supplement" five Big task.The number of enterprises applying for bankruptcy is also increasing.Bankruptcy reorganization system is an important system to save bankrupt enterprises,which plays an important role in adjusting the industrial structure of enterprises and optimizing the debt structure.The key to the success of enterprise restructuring is to solve the debt problem.Debt to equity swap is an important way for enterprises to adjust and optimize their debt structure,which plays an important role in reducing the leverage ratio of enterprises and saving enterprises in danger.Although the way of debt to equity in bankruptcy reorganization is beneficial to reduce the debt and burden of enterprises,it is difficult to apply the law when the bankruptcy reorganization procedure is combined with debt to equity,and there are also some problems in legislation.For example,the conditions of debt to equity conversion in bankruptcy reorganization are vague,and the operation process of debt to equity conversion is not standardized;the government's excessive intervention in debt to equity conversion has made the government's opinion of listed companies a precondition for enterprises to carry out debt to equity conversion in reorganization;there are some disputes between creditors and investors in the implementation of debt to equity conversion in bankruptcy reorganization on the voting rules of the draft reorganization plan;In the implementation stage of the reorganization plan including debt to equity,when the number of shares converted is more than 50,it exceeds the maximum limit of the number of shareholders of the limited liability company,whichconflicts with the company law;in the process of bankruptcy reorganization,some shares have been pledged,and debt to equity conversion without the consent of the pledgee has a certain impact on the effectiveness of debt to equity conversion.The first chapter of this paper analyzes the basic theory of bankruptcy reorganization.Firstly,it analyzes the concept of debt to equity under bankruptcy reorganization and introduces the nature and type of debt to equity.Secondly,it analyzes the legitimacy of debt to equity in the bankruptcy reorganization,and whether the implementation of debt to equity in the reorganization process is in line with the relevant provisions of the bankruptcy law and the company law.Finally,it analyzes the conditions needed for the implementation of debt to equity swap in the bankruptcy reorganization procedure.After analyzing these basic theoretical problems,the second chapter puts forward some problems existing in debt to equity swap under bankruptcy reorganization,such as the specific operation procedure of debt to equity swap is not stipulated in the law,the conditions of equity swap enterprises are too vague,and there are certain conflicts with the conditions of reorganization.Whether the voting rule of Article 84 of the enterprise bankruptcy law is applicable to the debt to equity swap in the reorganization procedure has some disputes in the actual operation.There are some problems such as the conflict between the number of the creditors of the swap and the maximum limit of the number of shareholders of the limited liability company,and the improper interference of the government in the debt to equity swap.The third chapter is to solve the problems raised in the second chapter,and to re sort out the conditions of the object of the conversion,and also to re-establish the criteria of the object of the conversion.This paper reinterprets the voting rules of investors and shareholders,reinterprets the provisions of Article 24 of the company law,and puts forward the criteria and conditions of the government's financial support for the reorganization of enterprises and the intervention of debt to equity conversion,as well as the suggestions for formulating the punishment mechanism.