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Corporate capital system

Author: SunXinGuo From: www.yourpaper.net Posted: 2009-06-29 14:46:15 Read:
Abstract: China's implementation of the statutory capital system, blatantly capitalist principle, but in practice false capital contribution withdraws the capital contribution and other phenomena frequently funded poor accountability, seriously disrupting the economic order. By combing the issues related to the company's capital system, pointed out certain defects of the Company Capital System in China and put forward constructive suggestions.
Keywords: capital system; statutory capital system; funded responsibility

1 capital three principles - the ideal and the reality fierce collision

To determine the principles of the three capital principles that capital, capital maintenance, capital the same principle, created the original French, German, and later inherited by the civil law countries. Law in China, 36, 84, 94 and other provisions of the capital requirements of the principle. The fundamental purpose of the three principles of the company's capital is to maintain the solvency of the company to maintain the normal operations of the company, maintaining the security of transactions. These principles of safeguarding the interests of the creditors and protect the interests of the shareholders and maintaining trading order, has a certain significance.
Capital three principles of abstraction of the company capital rules, company law and not directly to be provided. The capital three principles in today's economic environment increasingly detached from reality, has been more and more challenges and criticism, it values ??highly questionable. Little economic common sense of the people are not difficult to find, the registered capital of the company is a static concept, after the establishment of the company, the assets of the company is always in the midst of change, assets and capital are always inconsistent, the registered capital of creditors do not have much practical significance, it is more important for the creditor to the credit of the company's assets. "Capital credit to changes in credit assets, the prominent legal significance lies not in the design of the number of new legal system and increase the number of legal provisions, but rather on the reform of the existing Company Law system is canceled by the change in credit decisions, hinder the development of the company unreasonable and unnecessary system and constraints to reform the current system of capital to develop and improve the company's financial and accounting systems, and to achieve a comprehensive and fundamental protection of the interests of the creditors of the company.

Statutory capital system of the stick - the Legislative Design of Law in China

(1) The statutory capital system pioneered by France, Germany, imitated by many civil law countries. Legal capital system focus on the interests of the creditors protection and commercial transactions safety concept. System of the authorized capital of the company set up the threshold is too high, discourage investment, and the company is unable to make a timely response to the ever-changing market, thus bungled opportunities, this capital system for many countries in the Companies Act repealed. "The theoretical basis for the abolition of the minimum registered capital, the minimum registered capital requirements have arbitrary, and no relationship with the company's real capital requirements, and therefore not protected creditors has little practical significance."
(2) The authorized capital system is a creation of the British, American Companies Act, which the United States is typical of the national implementation of the authorized capital system. The authorized capital system with great flexibility, its biggest feature is empowering. The company set up in such a system will not be affected because the funds are not available, the operations need to increase capital or reduce capital do not need to convene a shareholders, the Board of Directors within the scope of authority by virtue of their business judgment can decide to reduce the company's cost to avoid the waste of capital.
(3) a compromise capital system is a civil law countries on the basis of absorption authorized capital system advantages, the range between the statutory capital system and the authorized capital system, a new corporate capital system. The system is authorized capital system of improved varieties, it absorbs some of the factors of the traditional legal capital system, be limited to the authorization of the Board. The compromise capital system not only provides for a lower, to determine the company registered capital and paid-up capital, given the rights of shareholders in the statutory proportion and time limits within flexible funded. Relative to statutory capital system, reducing the difficulty of setting up a company, to further promote the social capital into the company's operations, and improve the operational efficiency of the social capital, but also to improve the economic efficiency of the entire society. 3 to be well-funded liability system

3.1 of the breach of the obligation of contribution to the capital contribution obligations assumed
Civil law countries and scholars generally believe that the behavior of the investors to subscribe for shares purchase (the predecessor of the shareholders, to join the company for the purpose of the Societies Act referred to as the subscribers) with the company (or authority) set up in the company concluded join a company contract behavior. "Common Law scholars think the Share Subscription is an expressed willingness to purchase a company (including the establishment of the company) had not yet issued a specific number of shares and to pay the price offer, with the Rights Offering ( commitment) together constitute a a complete contractual relationship. "(limited liability company) shareholders do not fulfill the obligation of capital contribution constitutes a violation of the company's articles of association, fundamentally speaking, is a liability for breach of contract. therefore, if the shareholder does not fulfill the obligation of capital contribution to other losses has to fulfill the obligation of capital contribution of the shareholders, shall be liable for damages for breach responsibility. "(Co. Ltd.) the promoter not in accordance with the provisions of the preceding paragraph liable for breach of its capital contribution shall, in accordance with the promoters' agreement." However, how to understand the company Act 94 requirement? Shares in a limited liability company established in accordance with which promoters are not fully paid-funded bear the responsibility to pay the other promoters jointly and severally liable doubt directors ask other promoters or the establishment of capital contributions by the promoters bear liability for breach of it? Which did not give the answer. I believe that to exclude liability for breach of the applicable funded is not paid in full prior to the establishment of the company need to bear in back and breach of contract, and only need to bear the responsibility to pay the company was founded, which is obviously contrary to logic and reason. Therefore I believe that the promoters are not fully paid-funded the establishment of the AG is still in violation of Initiation Protocol shall also bear the other promoters or the company's liability for breach of contract, so as to meet the jurisprudence.
3.2 shareholders' liability for breach of the obligation of capital contribution
China's Company Law shareholders responsibility for breach of the obligation of contribution liability for breach of overdue responsibility, the difference between the fill responsibility and joint and several liability of the other shareholders, the surface design is perfect, is to strengthen the company's capital credit protection, but in practice those in violation of the contribution obligation of responsibility who should be investigated for it? First, we analyze the position of the other shareholders or promoters. Most clearly established promoter of the directors of the company and the company of the company's capital position, after the establishment of the company capital adequacy is well aware of, if shareholders do not funded or funded untrue, they will in the case of calls to no avail proceedings it? It is clearly impossible, because the won, if the shareholder is enforced fully paid in funded everybody happy, if the shareholders executable property, or enforceable property is less than the tax payable capital, the other shareholders of the company or initiate risk be liable to repay the responsibility, which no doubt is shooting itself in the foot. Secondly, the directors will sue the name of the company to do? Is unlikely. They still do not want the name of the company filed by the directors and controlling shareholder because the company's main decision-making decision, the directors still take orders from the controlling shareholder of the proceedings, the name of the company, other shareholders or promoters also face the risk of earlier analysis, weigh the pros and cons litigation.
From the above analysis, we can see that the provisions of the Companies Act funding obligations to shareholders flawed. Companies Act need to further clarify the funding responsibility prosecuted body to establish a sound system of contribution system, investigated the main responsibility must be clear in the legislation is the company to establish summon the loss of the right system, the establishment of the company shareholders or directors must bear the responsibility for calls. Can consider the following exercise steps: the shareholders or directors of companies to set up notice of violation of the shareholders of the contribution obligation funded paid off within a certain period of time; yet fully paid after the deadline after notification of loss of the right and held accountable for their liability for breach of contract; auction enrich capital and other initiators shall bear liability for the difference between the fill; directors indolent to fulfill its obligations, the provisions of the directors of the company set up jointly and severally liable if the company is set up.
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