Article 8 In any of the following circumstances, if the company claims that it does not bear the guarantee liability on the ground that it has not made a resolution in accordance with the provisions of the Company Law on the company's external guarantees, the people's court shall not support it:
(1) A financial institution issues a letter of guarantee or a guarantee company provides a guarantee;
(2) The company provides guarantees for the business activities of its wholly-owned subsidiaries;
(3) The guarantee contract shall be signed and agreed by more than two-thirds of the shareholders who hold the company individually or jointly and have the right to vote on the guarantee matters.
The provisions of items 2 and 3 of the preceding paragraph do not apply to the provision of external guarantees by listed companies.
【Purpose of the Article】
This article is about the exception of the company's external guarantee, which does not require the resolution of the authority.
【Overview of Provisions】
On the basis of following the provisions of Article 19 of the Minutes of the Civil and Commercial Trial Conference, this article has been slightly deleted, mainly in the following aspects: first, the provision of Article 19, Paragraph 3 of the Minutes of the Civil and Commercial Trial Conference on the need for a resolution on interconnection and mutual insurance is deleted; The second is to change Article 19, Paragraph 2 of the Minutes of the Civil and Commercial Trial Conference to "the company provides guarantees to creditors for the business activities of the companies directly or indirectly controlled" to "the company provides guarantees for the business activities of its wholly-owned subsidiaries"; Third, it is clarified that the provisions of subparagraphs 2 and 3 of paragraph 1 of this article shall not apply to the external guarantee provided by listed companies; Fourth, compared with Article 19, Paragraph 1 of the Minutes of the Civil and Commercial Trial Conference, although the expression of Item 1 of this article has changed slightly, the substance remains unchanged.
Controversial Points]
Whether the provisions of this article can be applied to the external guarantee provided by a listed company is a relatively controversial issue in judicial practice. There is also considerable controversy as to whether the provisions of this article apply to the external guarantees provided by wholly state-owned companies.
[Understanding and Application]
I. Basic Considerations of this Article
Article 16 of the Company Law stipulates that the company provides guarantees for others and that the company's resolution is a mandatory provision specifically to limit the authority of the company's legal representative to provide guarantees, and the act of providing security for others with the company's property is not a matter for the legal representative and other company personnel to decide alone, but must be resolved by the company's shareholders' meeting, shareholders' general meeting, board of directors and other corporate organs. In our view, the Company Law stipulates that in fact, the company's intention is taken as the basis and source of the right of representation, and the counterparty should have a duty of care to screen whether the guarantee act carried out by the legal representative is in line with the company's true intention when accepting the guarantee. In other words, as long as the creditor has evidence to prove that the legal representative signs the guarantee contract in the name of the company in accordance with the true intention of the company, the guarantee act meets the requirements for the validity of civil legal acts. When judging the validity of a guarantee contract, the existence of the company's resolution is, of course, the most direct written evidence to prove that the company has made a true expression of intent on the external guarantee. It is precisely for this reason that, in accordance with the requirements of the modernization of corporate governance, both the legislation and the judiciary have chosen to regulate the company's external guarantee behavior from the company's resolution as the starting point, so as to ensure that the company's guarantee conforms to the company's true intentions and prevent the legal representative from harming the legitimate interests of the company's other shareholders and creditors by being generous to others.
At the same time, it should also be noted that at the present stage on the mainland, it is of special significance to correctly handle the contradictory relationship between the goal of modernizing corporate governance and the current low level of corporate governance on the mainland, and to coordinate the internal and external relations of the company, so as to equally protect the legitimate rights and interests of the company's shareholders and creditors. In the practice of corporate adjudication, due to the lack of clarity in legislative provisions and the lack of uniformity in judicial adjudication rules, it is common for mainland companies to provide guarantees to others without the company's resolution. In the absence of a corporate resolution, based on the current reality of non-standard corporate governance, if the facts of the case show that the guarantee provided by the company's legal representative is for the benefit of the company, it can be determined that the company has the true intention to provide the guarantee to the outside world. If the judiciary determines that the company does not bear the guarantee liability just because the company has not made a resolution, it will not only disrupt the stable trading order of the company, but also easily breed the moral hazard of the company maliciously evading the guarantee liability. Based on the above considerations, this article clearly belongs to the exception to the company's resolution for the company to provide guarantee to creditors for its wholly-owned subsidiaries to carry out business activities, and the guarantee contract is signed and agreed by shareholders who individually or jointly hold more than two-thirds of the voting rights of the company. The reason for the exemption of the resolution for guarantee companies whose main business is to provide guarantees to others, as well as for banks or non-bank financial institutions that carry out guarantee business, is that companies engaged in the business of guarantee do not fall within the scope of regulation of Article 16 of the Company Law. It should be emphasized that, in addition to the three exceptions to corporate resolutions stipulated in this article, there are no other exceptions to corporate resolutions in the field of the company providing guarantees to others, and they must be strictly grasped.
2. Changes in this article compared with the "Minutes of Civil and Commercial Trial Meetings".
This article does not simply follow the provisions of Article 19 of the Minutes of the Civil and Commercial Trial Conference on the exceptions, but changes on its basis, and the main trend is to further restrict the exceptions: First, the interconnection and mutual insurance is very easy to cause the adverse social consequences of an accident of one enterprise and all the insured enterprises to suffer, and it is also easy to give people the feeling that the two illegal acts will lead to legal effects, so the Interpretation of the Guarantee System of the Civil Code deletes the provision that there is no need for a resolution on interconnection and mutual insurance. The second is to change Article 19, Paragraph 2 of the Minutes of the Civil and Commercial Trial Conference to "the company provides guarantees to creditors for the business activities of the company directly or indirectly controlled" to "the company provides guarantees for the business activities of its wholly-owned subsidiaries" to further limit the application of exceptions.
In judicial practice, a large number of cases have been generated on whether a listed company can apply the provisions of this article, and the adjudication standards are not uniform, so paragraph 2 of this article clearly stipulates that the provisions of subparagraphs 2 and 3 of paragraph 1 do not apply to the provision of external guarantees by listed companies.
3. Item 3 of Paragraph 1, Paragraph 8 of the Interpretation of the Guarantee System of the Civil Code stipulates that the shareholders who individually or jointly hold more than two-thirds of the voting rights of the company have signed and agreed to the signing of the guarantee
Article 8, Paragraph 1, Item 3 of the Interpretation of the Guarantee System of the Civil Code stipulates that if "the guarantee contract is signed and agreed by more than two-thirds of the shareholders who hold the company individually or jointly with the company and have the right to vote on the guarantee matters", if the company claims that it does not bear the guarantee liability on the ground that it has not made a resolution in accordance with the provisions of the Company Law on the company's external guarantees, the people's court shall not support it. In our view, this provision applies not only to the guarantees provided by the company to others (non-affiliated guarantees), but also to the guarantees provided by the company to its shareholders or actual controllers (related guarantees). In the case of related guarantees, according to paragraph 3 of Article 16 of the Company Law, the shareholders who are guaranteed or the shareholders who are under the control of the actual controller of the guarantee shall not vote on the matters of the guarantee. In practice, the shareholders who are controlled by the actual controller of the guarantee may be either nominee shareholders or shareholders who are controlled by the actual controller based on control by agreement. If the company does not provide a guarantee for the shareholders or actual controllers, but for the company controlled by the shareholders or actual controllers, according to the legislative purpose of Article 16 of the Company Law, it should be understood that it is appropriate to have related guarantees, otherwise it is impossible to avoid the major shareholders or actual controllers from harming the interests of small and medium-sized shareholders through the corporate guarantees.
In the case of non-related guarantees, even if the articles of association stipulate a resolution of the board of directors rather than a resolution of the shareholders' (general meeting), it will not affect the application of the above provisions, because in the case of non-affiliated guarantees, shareholders who individually or jointly hold more than two-thirds of the company's voting rights on the guarantee matters may amend the articles of association of the company through the shareholders' meeting to change the resolution organ that provides external guarantees to the shareholders' (general meeting).
[Practical issues]
Can this section be applied to wholly state-owned companies? In the process of drafting the Interpretation of the Guarantee System of the Civil Code, we considered stipulating that the provisions of Paragraphs 2 and 3 of paragraph 1 of this Article should not apply to wholly state-owned companies, but we did not make such provisions because such provisions did not seem to be in line with the principle of equal protection stipulated in the Civil Code. It should be noted that the Law on State-Owned Assets of Enterprises clearly stipulates that state-owned enterprises provide large-amount guarantees to the outside world, and according to the provisions of Articles 30 and 32 of the Law, the provision of large-amount guarantees shall be decided by the responsible persons of wholly state-owned enterprises through collective discussion, and the decision of the board of directors of wholly state-owned companies shall be made, and there is no question of applying the provisions of this article. Of course, the law does not clearly stipulate that the relevant provisions of the Interpretation of the Civil Code on the Guarantee System may apply to other guarantees other than large-amount guarantees. It can be seen that the handling of this issue cannot be generalized.