On The Cross-exercise Of Shareholder's Inspection Right

Under the model of separation of the shareholders ownership and management right,the directors and senior managers conduct exclusive management over the internal affairs of the company.When shareholders can't participate in the company's business decisions directly,the inspection right plays an imperative role for shareholders.While the present era is developing from a single company to multi-layer company structure.China's current commercial law,although allowing the existence of parent-subsidiary company structure,still focuses on the single company model.However,it is difficult to apply this model to parent-subsidiary relationship simply,such as the problem that the shareholders request access to the relevant information of the subsidiary.The development of the company model also puts forward higher requirements to protecting the interests of shareholders,and it is necessary to re-examine the rationality and applicability of the existing provisions.If necessary,it can be supplemented to some extent to enhance the applicability of the existing company law.Although China's current commercial law does not provide for shareholders to access the information of subsidiaries,the exercise of shareholders' special inspection right is essentially an appropriate expansion of the traditional object scope of shareholders' right of inspection,that is,the relevant documents and materials of subsidiaries can be accessed by the shareholders of the parent company.However,the introduction of a system or rule must have urgent practical needs and sufficient theoretical support.Judging from the judicial practice,the appeal for the exercising of this special right of access is often rejected according to the existing legal rules that shareholders' inspection right is based on their shareholder status.There are also courts that indirectly maintain the parent company shareholders' right to know the information of the subsidiary by extending the content of the consolidated financial statements or recognizing the validity of the provisions of the articles of association on this content,but the effect is minimal.The elaboration of pass-through theory,the fiduciary duty theory and returning on investment theory,the reasonable solution of the conflict of the exercise of the special right of inspection by shareholders,the subsidiary's commercial secrets and the fiduciary duty of the subsidiary's directors demonstrate the legitimacy and applicability of the exercise of the right to time-travel.Because of the pass-through theory coming from the denial of corporate personality and involving the denial of independent personality of subsidiaries,it must be applied under very strict conditions.First,the parent company should be the controlling shareholder of the subsidiary in the passing-through exercise of inspection right.The passing-through exercise of inspection right shall be limited to major occasions,such as the merger and division of subsidiaries and the transfer of major assets.Second,the parent company shareholders can exercise subjectively;the exercise method shall be limited to a written request to the parent company.Third,in terms of object scope,single company should expand the object scope of shareholders' right of access appropriately,and limited company's bond stubs should allow access without subject restrictions;the contract signed by the company shall be open for inspection,but supplemented by restrictions on the proper purpose;resolutions of the shareholders committee,records of the board meeting and the supervisors meeting shall be accessible without subject qualification restrictions;The shareholders of a joint-stock company shall have the right to consult the accounting books and meet the requirements of the proper purpose and the way of presentation in writing;it is clear that the original document belongs to the scope of inspection but the burden of proof for the proper purpose is borne by the shareholder.There should also be special restrictions on the scope of objects for the passing-through exercise of inspection right,which should be limited to relevant documents and records actually possessed and controlled by the parent company or obtained by virtue of its control over the subsidiary company.Fourthly,legitimate purpose restriction is related to the protection of the personal interests of the parent company shareholders or the interests of the company(the parent company or its subsidiaries),and the burden of proof shall be borne by the parent company shareholders.In addition,it can also promote the pass-through exercise of inspection right through the transitional way of issuing explanatory guidance cases.