On The Perfection Of The Legal Relief System Of Shareholder Oppression In My Country’s Limited Liability Companies

Limited liability companies is an important part of my country’s market entities.How to provide market entities with an effective and sound legal protection system is an important task of my country’s "Company Law".Shareholder oppression originated in foreign countries,and it is common in foreign closed companies.Due to the lack of open stock exchange markets and closed characteristics in China’s limited liability companies,the phenomenon of shareholder oppression is also a governance problem for my country’s limited liability companies.However,my country’s judicial practice does not pay enough attention to the issue of shareholder oppression.This is not only due to the fact that my country’s "Company Law" does not specify the content of shareholder oppression,but also depends on the consistent conservative attitude of my country’s judicial organs in the trial of company cases,resulting in many hidden issues.The problem of shareholder oppression contained in legal forms cannot be remedied,and it will be detrimental to the development of my country’s market economy in the long run.Due to the harmfulness of shareholder oppression,it is necessary to analyze the connotation and causes of shareholder oppression,and to find the relief system provided by my country’s current laws and regulations based on the cause,and analyze whether the above-mentioned systems can effectively curb the phenomenon of shareholder oppression and provide law for suppressed shareholders protection.At the same time,since shareholder oppression originated from abroad and there are relatively mature systems abroad,we can learn from foreign experience and combine our own national conditions to improve our country’s legal regulations and provide applicable references for judicial organs.This article first defines the definition of shareholder oppression.The main reason why controlling shareholders can implement shareholder oppression is the voting principle of capital majority voting,coupled with the closed nature of limited liability companies,it is difficult for small and medium shareholders to effectively withdraw from the company,resulting in shareholder suppression is an inherent governance problem of limited liability companies.Therefore,how to correct the abuse of capital majority decision and improve the share withdrawal mechanism of suppressed shareholders in limited liability companies are two effective ways to curb the phenomenon of shareholder suppression.Secondly,the systems that can rectify the abuse of capital majority decisions in my country’s current laws and regulations are mainly the principle of prohibition of equity abuse and the company resolution system.However,the review of company resolutions in judicial practice is often a mere formality,and the principle of prohibition of equity abuse is lacking.It is difficult to apply.Therefore,oppressed shareholders can only hope to withdraw from the company by submitting an objection to the share repurchase request or applying for judicial dissolution of the company.However,the objectionable share repurchase system and the judicial dissolution system can only apply to shareholder oppression under specific circumstances,and the standards are extremely strict.It is difficult for oppressed shareholders to effectively exit the company through the above-mentioned system.In contrast to foreign countries,the British and American countries can effectively define shareholder oppression in judicial practice,and both countries have provided remedies for suppressed shareholders,including but not limited to share purchases and judicial dissolution,which are worthy of our country.Finally,due to the insufficiency of my country’s current laws and regulations,my country should first explain the prohibition of abuse of shareholder rights in Article 20 of the "Company Law",and interpret the violation of fiduciary duties by controlling shareholders to damage other shareholders’ reasonably expected interests as an abuse of shareholder rights.And build a revocable system of resolutions that abuse the majority decision.At the same time,my country should learn from the relief measures of the United Kingdom and the United States,and classify shareholder oppression as a statutory situation for suppressed shareholders to request share repurchase and judicial dissolution of companies,but at the same time,it should stipulate that one of the prerequisites for the application of judicial dissolution is that other relief measures cannot protect oppressed shareholders.Therefore,it is possible to effectively curb the complicated phenomenon of shareholder oppression in practice,protect the legitimate rights and interests of oppressed shareholders,and promote the development of my country’s market economy.