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Corporate Governance

  3, Vesting in shareholders the right to bring a lawsuit against the defective resolutions of shareholders'' general meetings.  It is approved in civil law system that shareholders are entitled to request the court to declare the defective resolutions avoidable or rescissible. ⑽  Company Law of China , Article 111 provides it very simply .⑾ But as to the requirement “to violate the law or administrative rules and regulations” and “to infringes the lawful rights and interests of shareholders”, we are puzzled whether both of them are needed or either of them is enough for shareholders to bring a lawsuit? How many shares should shareholders hold to enjoy this right? And who is the defendant ? The Law should provide these aspects.
  4, Establishing Shareholders’ Representative Suit System.  Shareholders’ Represen-tative Suit deals with that shareholders can represent corporation to bring an accusation against the directors, managers or supervisors when they violate the law or infringe interests of corporation but corporation does not bring an accusation for some reasons. The firsthand purpose of it is the maintenance of the interests of corporation, and the ultimate purpose is to uphold shareholders’ interests. Legal provisions of Shareholders’ Repre-sentative Suit overseas are highly developed, but the Company Law of China provides no articles or sections about it. So it is suggested to add Shareholders’ Representative Suit in the Company Law: the accusation must be well-meaning and be after exhaustion of intra corporate remedies;the warranty of legal fare ;the limitation to the abuse of this right,etc.
  (Ⅲ)Perfecting the director system
   The development of modern market economy has resulted in the conversion of the center of corporation from shareholders'' general meetings to the board of directors。In spite of a good many positive effects,the conversion aggravates the conflict of interests between shareholders and directors.⑿ Then, how can we settle the conflict ? How to unify the rights obligation and liability of directors?


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