On July 1, 2024, the new company law came into effect. From the perspective of wealth management, the new company law imposes stricter liability on shareholders' capital contributions, and even breaks through the "limited liability". At the same time, in order to urge shareholders to fulfill their core obligation - capital contribution, ensure the company's capital adequacy and protect the trust interests of creditors, the new company law also puts forward higher and stricter requirements for the performance of corporate executives. Recently, Mr. Xue Jing has shared the risk hotspots, key points and blind spots of the new company law on various occasions, and now sorted out the top 10 impacts on business owners for the benefit of readers.
1. The shareholders' paid-in capital contribution obligations on time and in full "penetrated", and the limited liability began to break through
The corporate system and limited liability are one of the greatest inventions in the history of human business. However, the limited liability of shareholders is that shareholders are liable for the company's debts to the extent of their subscription rather than their actual payment. After the implementation of the new company law, shareholders' capital contribution responsibilities began to "penetrate" - they must not only be responsible for their own promised subscribed capital contributions, but also be responsible for the full and scheduled capital contributions of other shareholders: such as shareholders who start a joint business, shareholders who acquire their own equity (including subscription), and other shareholders who have been expelled from their rights...... In a word, all of these are to promote shareholders to fulfill their capital contribution obligations and protect the company's capital adequacy.
2. Executives are responsible for strictly supervising shareholder behavior and ensuring the adequacy of the company's capital
The directors, supervisors and management personnel of the company are the main body entrusted with the management of the company, and have the duty of loyalty and diligence to the company, and are responsible for the interests of the company and shareholders. In reality, senior executives may submit to the will of the actual controller, or even be a major shareholder or actual controller who is also an executive, and may have behaviors that harm the interests of the company, thereby harming the interests of external creditors. Therefore, the New Company Law is more specific to the duty of loyalty and diligence of senior executives, including urging shareholders to pay in full and on time for capital contributions, and even assuming the liability of shareholders to exclude their rights, and at the same time stipulates that if they neglect to perform their ex-rights, illegally reduce capital, liquidate, pay dividends, and assist shareholders in withdrawing their capital contributions, the senior executives shall be liable for compensation for the company's losses. By increasing the responsibility of senior executives to supervise the company's capital adequacy, a series of "tight mantras" have been erected, so that the independent property and independent personality of the company's legal person can be emphasized and protected, rather than a tool for shareholders and actual controllers to abuse the company's limited liability to evade debts. Under the new company law, executives are not only meant to be well paid, but also to be high-risk. Therefore, the directors, supervisors and managers of the company who should learn the new company law the most should be learned - shareholders make mistakes and executives are held accountable, which is the "board" laid down by the new company law.
3. Under the New Company Law, it is not suitable to set up a one-person company, a husband and wife company, or a parallel company
The premise of a limited liability company is a joint venture between shareholders, so for a sole shareholder-owned company, both the old and new company laws have "doubts" about the true intentions of the shareholders - whether there is an abuse of the independent status of a legal person to evade unlimited liability for personal debts. Therefore, if a wholly natural person proprietorship company cannot prove that the company's property is independent of the sole shareholder's property, the shareholder no longer enjoys the treatment of "limited liability" and bears joint and several liability for the company's debts - at this time, a one-person company is actually equivalent to a self-employed person, which is confused with the shareholders' assets and liabilities. If the company adds one shareholder, but the two shareholders are husband and wife, is there still a suspicion of a one-person company? The answer is: yes. According to the judgment of the Supreme People's Court, based on the common nature of the equity and income of the husband and wife shareholders, a husband and wife shareholder company will be regarded as a one-person company, and if the company owes debts, if the shareholders cannot prove that the company and its assets are "clearly distinguished", the company will be pierced at this time, and the husband and wife shareholders will be jointly and severally liable for the company's debts (joint debts). A new change in the New Company Law is that if there are several "parallel companies" under the actual control of one shareholder, if there are actual controllers who abuse the limited liability of the company to evade debts, it will also break through the status of independent legal persons of these companies, that is, each company under the actual control of one person shall be jointly and severally liable for the debts of any company.
4. After the implementation of the new company law, it is recommended not to participate in shares and invest in companies that you do not understand
Equity investment is an important way for many people to achieve financial freedom, but after the implementation of the new company law, there is a new type of risk of equity investment - after becoming a shareholder, not only must you pay it yourself, but also ensure that other shareholders pay it on time and in full, so that you will not face the risk of paying for other shareholders, and you can sleep at night to be sure. Therefore, after the implementation of the new company law, equity investment has become more prudent and professional.
5. After the implementation of the new company law, it is recommended not to serve as a director or legal representative of a company lightly
Under the current system, if a company owes debts, the legal representative may be subject to measures to "restrict high consumption" to urge the company to repay the debt. Therefore, in reality, many actual controllers of companies have resigned as legal representatives and served as other people. However, after the implementation of the new company law, serving as the legal representative is no longer a nominal concept, and the legal representative must be a director of the company and needs to be responsible for the interests of the company, especially the directors who neglect to perform their duties are responsible for the non-payment of shareholders' capital contributions, illegal capital reductions, dividends, and liquidation. Therefore, after the implementation of the new company law, the legal representative who is named but does not actually participate in the operation of the company is a high-risk position.
6. After the implementation of the new company law, the value of in-kind capital contributions is "inflated", and both shareholders and executives are liable
After the implementation of the New Company Law, the maximum period for paid-in capital contributions by shareholders of a company will be reduced to five years, and the deadline for paid-in capital contributions will be June 30, 2032 for existing companies before the implementation of the New Company Law. Many existing companies with excessively high registered capital subscriptions and excessively long capital contribution periods are considering countermeasures: nothing more than cancellation, capital reduction and paid-in. The process of deregistration and capital reduction is complex and requires passing the company's creditors. Therefore, many companies may consider finding another way to complete their paid-in obligations by means of in-kind contributions. However, if the appraised value of the in-kind capital contribution is "inflated", the shareholders need to bear the responsibility to make up the capital contribution, and the directors and executives who are at fault are also liable for compensation.
7. After the implementation of the new company law, creditors can have more remedies to protect their rights
After the implementation of the new company law, in the face of the company's debts that cannot be repaid, the company's creditors have increased the following possibilities: chasing the liability of shareholders for paid-in capital contribution, pursuing the joint and several liability of all shareholders at the time of the establishment of the company, pursuing the liability for compensation for the fault of senior executives in the performance of their duties, requiring shareholders who have not yet completed the capital contribution period to accelerate the expiration of their capital contribution liabilities, and pursuing the liability of the original shareholders who sell their equity to the current shareholders to supplement the paid-in capital contributions...... From the perspective of corporate law, the other side of shareholder and executive risk is the rights and opportunities of the company's creditors to protect their rights.
8. If a shareholder divorces his or her spouse from a non-shareholder, the consent of other shareholders is no longer required for the division of equity
After the implementation of the New Company Law, if a shareholder's divorce involves the division of the company's equity with the spouse of a non-shareholder, according to the provisions of the Company Law and the Civil Code, it is a transfer of equity to an external party, and the latest provisions of the New Company Law will apply, which no longer requires the consent of more than half of the shareholders, and only needs to ensure the shareholders' right of first refusal under the same conditions. However, since the divorce division of equity is not a commercial transaction and there is no transfer price, how to determine the "same conditions" to protect other shareholders from exercising the "right of first refusal"? At present, there are no clear provisions in the Company Law and the Civil Code. In order to break the asymmetry of business information, for the spouse of a non-shareholder, Mr. Xue Jing suggested that he could become a minority shareholder of the company when the marital relationship was stable. In this way, in the event of a divorce, both parties are internal shareholders and can block the other shareholders from exercising their "right of first refusal". Of course, after the non-shareholder spouse becomes a shareholder, while enjoying the convenience of shareholder status, all the risks of the shareholder under the new company law must also be borne at the same time.
9. After the implementation of the New Company Law, shareholders can inspect the accounting documents of wholly-owned subsidiaries
After the implementation of the new company law, shareholders' right to know has been extended to the right to inspect the company's accounting documents – with reasonable grounds and the company's consent, of course. This type of "audit right" can even penetrate to a wholly-owned subsidiary of a shareholder-owned company. The purpose of the legislator is to protect shareholders from knowing the true business situation of the company and its wholly-owned subsidiaries, and to better protect the rights of shareholders by breaking the information asymmetry. However, in reality, there are also shareholders who abuse the right to know after the breakdown of the relationship to interfere with the normal operation of the company and its subsidiaries and infringe on trade secrets. At this time, according to the latest provisions of the Company Law, reasonable reasons must be required to refuse the shareholder's inspection, or the subsidiary company is changed to a non-wholly-owned subsidiary - after all, the subsidiary that the shareholder has the right to penetrate down is limited to a "wholly-owned subsidiary".
10. After the implementation of the New Company Law, a new type of high debt risk has arisen - the risk of shareholder capital contribution
After the above combing, it can be seen that the new company law makes the capital contribution obligation of the company's shareholders a new type of debt risk, including the liability risk of shareholders' paid-in capital contributions, the risk of passing on the liability of other shareholders' paid-in capital contributions, and the liability of executives for defective shareholders' capital contributions...... Different from traditional contracts, financing, loans, and guaranteed debts, many business owners are still very unfamiliar with the various new debt risks caused by defective shareholders' capital contributions under the new company law, and there are many blind spots and even ignorance.
In short, the era of the new company law has put forward higher requirements for the compliance awareness of business owners and executives. Planning first, then starting a business, first guaranteeing and then tossing, is the underlying logic that every business owner needs to think about.
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