First, the articles of association should be applied without violating the mandatory provisions of the company law.
Second, when the articles of association conflict with the mandatory provisions of the Company Law, the provisions of the Company Law shall apply.
If the articles of association are only inconsistent with the arbitrary provisions of the company law, the effectiveness of the articles of association cannot be denied. If the articles of association violate the mandatory provisions of the Company Law, the articles of association shall be invalid. A company can change the arbitrary provisions of the company law by formulating or amending its articles of association. In case of any inconsistency between the Articles of Association and the Company Law, the Articles of Association shall prevail.
Impact on shareholders:
The articles of association are generally regarded as a contractual relationship between shareholders, which makes shareholders have mutual obligations. Therefore, if a shareholder's rights are infringed by another shareholder's violation of personal obligations stipulated in the company's articles of association, the shareholder can claim rights from another shareholder according to the company's articles of association.
However, it should be noted that the basis of shareholders' rights request should be the rights and obligations between shareholders stipulated in the company's articles of association, such as the preemptive right of shareholders in a limited liability company to transfer their capital contribution, rather than the rights and obligations between shareholders and the company. Shareholders violate their obligations to the company, and the interests of the company are infringed. Other shareholders cannot claim rights directly from shareholders, but only through the company or in the name of the company.
Therefore, when the Company Law is inconsistent with the articles of association, it should be decided according to the specific circumstances. If the articles of association are amendments of the company, the provisions of the articles of association shall apply, but the articles of association shall not violate the mandatory provisions of the law. In other words, once the articles of association violate the mandatory provisions of the company law, then the provisions of the articles of association are invalid, and the company law should be applied at this time.