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On the Deadlock in the Limited Liability Company and Countermeasures

Author: ZhangZuo
Tutor: MengQingZuo
School: Hebei University
Course: Legal
Keywords: Corporate deadlock Jurisdiction Dilemma Limited Liability Company Act
CLC: D912.29
Type: Master's thesis
Year: 2010
Downloads: 64
Quote: 1
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Abstract

Limited liability company is a special corporate form. It forms with other firms is one important difference, namely that it is not a business organization inevitable product of natural evolution, there is no other company of its own historical experience as the deep cultural traditions or heritage. As some scholars said, the limited liability company is the German legislators to the table full of creation, is the most talented German legal creation. Germany 1892 "limited liability company," the enactment of the limited liability company system marks the birth. Limited liability company is basically the company absorbed several other forms of benefits, while avoiding their shortcomings: limited liability and the shareholders of a limited number of easy-to-manage, business confidentiality, the establishment of simple, this form is particularly suitable for SMEs. Thus, although a limited liability company in size than the Corporation, however, but the number of limited liability company is far ahead. Law in China started relatively late, and in a very long time concern of scholars has focused largely on Co., Ltd., a limited liability company so many diseases are not as valued by researchers, which is a limited liability company in China economic life of the important role played extremely consistent, should cause us to reflect on.Company deadlock is to run a company in existence during the between the shareholders or directors divided, and unwilling to compromise with each other in a stalemate situation, leading companies can not make decisions in accordance with legal procedures or even to make and can not be effectively implemented so that the company is in can not function properly, or even the fact that state of paralysis. In judicial practice, the company generally deadlock exists in the limited liability companies, especially small number of shareholders, the company smaller companies, it is because of the limited liability company has closed, co-author of the other features that the company deadlock is inextricably linked to the production. In the event an impasse, the company completely paralyzed, unable to make decisions, can not take any action, which will inevitably lead to serious damage to the company’s interests. First of all, the company itself, not the normal production and operation of the company, increasing consumption and destruction of assets; followed by the shareholders, shareholder rights can not be exercised by the great harm the interests of shareholders, once again, for the creditors of the company, its legal rights can not be effectively maintained. Company deadlock-prone in the limited liability company and limited liability companies because the market economy and meet the practical needs of SME development so there are a lot in our country, therefore, prevent the occurrence of imminent corporate deadlock

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