On The Validity And Institution Of Shareholder Agreements In Corporations

The emergence and rise of shareholder agreements has its profound background in corporate governance and solid backup with legal theories.Foreign practices of the institution of shareholder agreements take two kinds of approaches,namely overall statutory law and partial statutory law mode,however,both modes respect the freedom of self-governance,and draw a clear line between unanimous shareholder agreement and non-unanimous shareholder agreement.Though Chinese law has not prescribed the definition and scope of shareholder agreements,there are generally three types of such agreements in the judicial practice,namely agreements concerning corporate governance issues,corporate form,and shareholder's rights or obligations in the corporate law.The court approves the validity of shareholder agreements in general and some cases recognize the expanding binding effect to the corporation,but the court still has to take the perspectives of both contract law and corporate law into account in trial.What's more,the nature and interactive relations among shareholder agreement,articles of association,and shareholder's resolution remains a problem,because the explanation of shareholder's agreements as either articles of association or shareholder's resolution would lead to the oppression to minority shareholders.As a result,this paper suggests that shareholder's agreement shall be an independent self-governing mechanism parallel with articles of association and shareholder's resolution through statutory rules.Moreover,the application of unanimous shareholder agreement will prompt the redesign of corporate form institution,and help draw a difference between closely-held corporation and public corporation.This paper consists of four chapters.The first chapter reviews the social and theoretical foundation of shareholder agreements.The corporate governance background include the variation of the separation of ownership and operation,the global convergence and deregulation of corporate law,the inadequate ex ante rules and post remedies,and bureaucratism in business registration.The autonomy of private law and the corporate contract theory,and the balance between majority rule and the equality among shareholders constitute the theoretical backup.The second chapter takes the perspective from comparative law.The institution of shareholder agreements in foreign jurisdictions like the USA,the UK,and Canada generally take two kinds of approaches,namely overall statutory law and partial statutory law mode.And the scope of shareholder agreements is confined in corporate governance.Then the chapter takes tentative steps to make a definition to and classification of shareholder agreements based on foreign practices.The third chapter conducts empirical study on cases trialed in Chinese courts,including three types of cases,namely agreements concerning corporate governance issues,corporate form,and shareholder's rights or obligations in the corporate law.It finds that the validity and expanding binding effect of shareholder agreements are generally recognized by the court,however,the nature of shareholder agreements and the interactive relations among shareholder agreements,articles of association and resolution are not specified in the judgments.The last chapter focus on the institutional function of shareholder agreements,and considers the nature of shareholder agreements,and the interactive relations among shareholder agreements,articles of association and resolution.The chapter also givers suggestion for the legislation of shareholder agreements,and illustrates the institutional implication of shareholder agreements for the classification of closely-held corporations and public corporations.