Differences between Article 74 and Article 142 of the Company Law

When the company fails to distribute profits to shareholders for five consecutive years or the company is merged. This provision will apply to the transfer of major property. This article is the legal shareholder's right to repurchase. According to this clause, shareholders can ask the company to buy its equity at a reasonable price. If the shareholders and the company cannot reach an agreement, the shareholders may bring a lawsuit to the people's court within the statutory time limit.

Legal basis:

Company Law of the People's Republic of China

Article 74 In any of the following circumstances, a shareholder who votes against the resolution of the shareholders' meeting may request the company to purchase its equity at a reasonable price:

(a) the company has not distributed profits to shareholders for five consecutive years, but the company has made profits for five consecutive years and meets the conditions for distributing profits as stipulated in this Law;

(2) The merger, division or transfer of the company's main property;

(3) Upon the expiration of the business term stipulated in the Articles of Association or other reasons for dissolution stipulated in the Articles of Association, the shareholders' meeting will adopt a resolution to amend the Articles of Association to make the Company survive.

If the shareholders and the company fail to reach an equity purchase agreement within 60 days from the date of adoption of the resolution of the general meeting of shareholders, the shareholders may bring a lawsuit to the people's court within 90 days from the date of adoption of the resolution of the general meeting of shareholders.