Shareholders may request the board of directors to sue the legal representative in the name of the company to bear the corresponding liability for compensation. If the board of directors fails to perform its duties, it may request the board of supervisors to bring a lawsuit to the court in the name of the company.
If the Board of Supervisors also fails to perform its duties, shareholders may bring a lawsuit to the court in their own name and hold the legal representative accountable.
Article 20 of the Company Law of People's Republic of China (PRC)?
Shareholders of a company shall abide by laws, administrative regulations and the articles of association of the company, exercise their rights according to law, and shall not abuse their rights to harm the interests of the company or other shareholders, or abuse their independent status as a legal person and limited liability to harm the interests of the company's creditors.
Shareholders of a company who abuse their rights and cause losses to the company or other shareholders shall be liable for compensation according to law.
Shareholders of a company who abuse the independent status of a company as a legal person and the limited liability of shareholders to evade debts and seriously damage the interests of creditors of the company shall be jointly and severally liable for the debts of the company.
Article 107 of the Contract Law
If one party fails to perform its contractual obligations or fails to meet the contract obligations, it shall bear the liabilities for breach of contract such as continuing to perform, taking remedial measures or compensating for losses.
Extended data
Rights of legal representatives
1. The legal representative of an enterprise shall exercise power and perform obligations within the scope of functions and powers stipulated by national laws, regulations and the articles of association of the enterprise, participate in civil activities on behalf of the enterprise as a legal person, and be fully responsible for the production, operation and management of the enterprise.
2. The legal representative of the enterprise may entrust others to perform their duties.
The legal representative of the enterprise shall entrust others to perform their duties. The duties that must be performed by the legal representative according to laws and regulations shall not be entrusted to others.
4. The legal representative of an enterprise as a legal person is the signatory who exercises power on behalf of the enterprise.