In this issue, we analyze the "horizontal competition" that puzzles bosses-the situation that directors and senior executives of a company start new business and do similar competitive business with their old employers during their tenure. Generally speaking, industries with technical thresholds or capital-intensive industries are not easy; This happens from time to time in industries that attach importance to assets, have low technical threshold and are highly dependent on customer resources.
law
First of all, the law stipulates that directors, supervisors and senior managers have the duty of loyalty and diligence to the company. Article 148 of the Company Law, directors and senior managers shall not commit any of the following acts: (5) Without the consent of the shareholders' meeting or the shareholders' general meeting, taking advantage of their positions to seek business opportunities belonging to the company for themselves or others, and running the same business as the company they work for; This prohibition has appeared, and the law stipulates the "right of return". In other words, the income of directors and senior managers who violate the provisions of the preceding paragraph belongs to the company.
Identity and recognition
First of all, the identification of senior management personnel legally refers to "managers, deputy managers, financial officers, secretaries of the board of directors and other personnel stipulated in the articles of association of listed companies". That is to say, if a salesman or department manager, even if there is such infringement, he can only be held accountable according to the route of the Labor Contract Law, but not directly applicable to the Company Law.
Therefore, it is also suggested to define directors and other management personnel as "other personnel specified in the Articles of Association" to meet the above "other personnel specified in the Articles of Association". According to the author's past experience, when the court examines the identity of an executive, it will focus on whether the person has certain influence and leadership when exercising his duties. That is, whether the person has a certain right to use human rights and decision-making, and whether he has the right to sign and approve projects during his tenure at a certain post. It should be noted that executives often have two levels of identity, both holding management positions as stipulated in the Company Law and employee relations with the company as stipulated in the Labor Contract Law.
Therefore, it is not that executives have no responsibility after leaving their jobs. If it can be proved that he used the resources and influence of the company to carry out competitive business during his original tenure, which harmed the interests of the original company, it can also be considered as horizontal competition.
Regarding the determination criteria, we found that some courts looked at whether the business scope of the two companies overlapped; However, some courts will examine whether the actual business activities of directors and senior managers are similar to those of the companies where they work. It can be understood that the former is a formal standard and the latter is a substantive standard.
Some courts believe that as long as companies in the same industry are in the name of directors and senior executives, they can form horizontal competition; However, some courts hold that if directors and senior executives are just "ordinary shareholders" and are not actual controllers in companies participating in horizontal competition, and there is evidence to prove that they are not actually operating, it does not constitute horizontal competition.
How does the company pursue responsibility?
For this kind of behavior that harms the interests of the company, the law stipulates the right to return goods. Income right refers to the transaction in which directors and senior managers compete with each other as the company's transaction; Under this logic, the company can naturally require that its illegally obtained non-competition income and remuneration also belong to the company. In the specific calculation, it includes not only the profits of the same company, but also the amount converted from the shares held by senior executives; There is also the remuneration that executives get in the same industry activities. It can be seen that this is the law using the right of classification to make up for the losses suffered by the company.
The former subordinates became rivals today, and the boss was angry. Some even want to "arrest people" through criminal procedures and teach their former subordinates a lesson. At this time, if it is confirmed that directors and senior managers embezzle or misappropriate the company's property, which is suspected to constitute the crime of embezzlement and misappropriation of funds, criminal measures can be taken; Otherwise, it is still the field and category of labor law and company law, that is to say, directors and executives can only be required to compensate for losses.