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The Study of Reform of Germany Limited Liability Law and the Inspiration to China

Author: JiaXiaoShan
Tutor: ChaiRuiJuan
School: Shandong University
Course: Legal
Keywords: Germany Limited liability Company Law reform
CLC: D9
Type: Master's thesis
Year: 2013
Downloads: 105
Quote: 0
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Abstract


"The German Limited Company of Modernization and Anti-abuse Law" came into effect on November1,2008. Since the end of20.Century, after decades of repeated discussions and a long wait,"the German Limited Liability Company Law", which has a history for more than100years, finally ushered in a most important reform since its establishment.Due to the advantage of limited liability for the promoters, as well as the relatively simple procedures by a foundation of company, this business organization form,"The Limited liability Company" so welcomed by German SMEs since it had been established. The flexibility of this system promoted greatly the development of SMEs, by which promoted the whole national economy. By the success of the Limited Liability Company Law in Germany, other European countries began to follow, and this type of Limited Liability Company was rapidly popular in Europe. According to statistics, there were about550,000limited liability companies in Germany by2009, with a total capital more than120billion Euros, while the Corporation only about3200, with a total capital of about83billion Euros.Nevertheless, since the end of20.century, the system of German Limited Liability has been falling into a serious threat.UK Limited Liability Company Law does not have the requirements on the minimum registered capital, and compared to the Limited Liability Company in Germany, its foundation is more simple, the costs is lower, and the shareholder take smaller responsibilities. In addition, due to the principle of freedom of establishment in EU and the pressure by the European Court of Justice, Germany large capital outflows, this affects seriously the steady development of the German economy. It can be said that the German Limited Liability Company has been in a very disadvantageous position in competition with the other nations of the Companies Act, and a reform is inevitable.This paper introduces the reform of German limited liability company Law mainly from three aspects. First, this paper will analyze the underlying reasons behind this reform. Second, this research will introduce the change of the system in this new law. And last, this paper will give a general comment of this reform. In addition, this paper will take the advantage of this German company Law and analyze briefly the reform of the Chinese Company Law.

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