The new "Company Law" contains Chapter 13 and Article 219. Only more than 20 articles in the original law have remained unchanged. Other terms and conditions have been added or deleted. The number of provisions in the new law has been slightly reduced, but the legislative system and legal structure are more reasonable and rigorous. So what are the differences between the old and new Company Laws? Next, we will answer this question for you.
Differences between the old and new Company Laws
The "threshold" for company establishment is lowered. The new Company Law significantly reduces the minimum amount of registered capital for company establishment and relaxes restrictions on shareholder capital contributions. , allowing installment payment of capital contributions. The old company law stipulates that the minimum registered capital of a limited liability company is: RMB 500,000 for companies mainly engaged in production and wholesale of goods, RMB 300,000 for companies mainly engaged in commercial retail, technology development and consulting , service companies are RMB 100,000 and are required to be paid in full in one go. The new company law stipulates that the minimum registered capital of a limited liability company is RMB 30,000, which can be paid in full in two years according to the prescribed proportion, of which investment companies can pay in full within five years. The old Company Law stipulates that the minimum registered capital of a joint-stock company is 10 million yuan. The new company law stipulates that the minimum registered capital of a joint-stock company is reduced to 5 million yuan. The old Company Law stipulates that the amount of capital contributed by a limited liability company in the form of industrial property rights and non-patented technology shall not exceed 20% of the registered capital of the limited liability company. The New Company Law stipulates that the monetary contribution of all shareholders of a limited liability company shall not be less than 30% of the registered capital of the limited liability company. In the revision of the Company Law in 2014, in conjunction with the implementation of the capital subscription system, the limit of 30% of registered capital has been cancelled, that is, registered companies no longer require the proportion of monetary investment, and there is no longer a limit on the minimum amount of capital contribution (special Industry, corresponding regulations must also be implemented), all shareholders shall subscribe and pay capital contributions according to the agreed period. The old company law stipulates that if a company invests in other limited liability companies or joint stock companies, except for investment companies and holding companies specified by the State Council, the cumulative investment amount shall not exceed 1% of the company's net assets. Fifty. The New Company Law stipulates that companies can invest in other enterprises; however, unless otherwise provided by law, they may not become an investor that bears joint and several liability for the debts of the invested enterprise. The new Company Law also stipulates: A company's investment in other enterprises or provision of guarantees for others shall be resolved by the board of directors or shareholders' meeting or general meeting of shareholders in accordance with the provisions of the company's articles of association; the company's articles of association have limits on the total amount of investment or guarantee and the amount of a single investment or guarantee. stipulated, shall not exceed the stipulated limit. It is clear that the company can provide guarantees for shareholders. The old company law stipulates that directors and managers shall not use company assets to provide guarantees for the company's shareholders or other personal debts. The New Company Law stipulates that if a company provides guarantees for the company's shareholders or actual controllers, it must be resolved by a shareholders' meeting or general meeting of shareholders. Granting shareholders the right to petition for the dissolution of the company. The old Company Law only stipulated three circumstances for voluntary dissolution of the company, and did not provide for whether shareholders can petition the court to dissolve the company. The new Company Law has stipulated this. The old Company Law stipulates that a company may be dissolved under any of the following circumstances: (1) When the business restrictions stipulated in the company's articles of association expire or other reasons for dissolution stipulated in the company's articles of association arise; (2) The shareholders' meeting resolves to dissolve; (3) Due to The merger or division of the company requires dissolution. The New Company Law stipulates: If a company encounters serious difficulties in its operation and management, and its continued existence will cause heavy losses to the interests of shareholders, and cannot be solved through other means, shareholders holding more than 10% of the company's total shareholder voting rights may request the People's Court to dissolve the company. Improving measures and methods for shareholders to understand the company's relevant affairs. The old company law stipulates that shareholders have the right to inspect the minutes of shareholders' meetings and the company's financial accounting reports. The new company law stipulates that shareholders can request to inspect the company's accounting books. If a shareholder requests to inspect the company's accounting books, he or she shall submit a written request to the company stating the purpose.
If the company has reasonable grounds to believe that a shareholder's inspection of accounting books has improper purposes and may harm the company's legitimate interests, it may refuse to provide inspection and shall reply to the shareholder in writing and explain the reasons within 15 days from the date of the shareholder's written request. If the company refuses to provide inspection, shareholders may request the People's Court to require the company to provide inspection. One "person" is allowed to establish a limited liability company. The old company law stipulates that a limited liability company shall be established with the joint investment of two shareholders of more than 50 years old. The new company law stipulates that a limited liability company shall be established with capital contribution from less than fifty shareholders. The new company law also stipulates that the minimum registered capital of a one-person limited liability company is RMB 100,000. Shareholders shall pay the capital contribution amount stipulated in the company's articles of association in full at one time. A natural person can only invest in the establishment of a one-person limited liability company. This one-person limited liability company cannot invest in the establishment of a new one-person limited liability company. [6] Shareholders have the right to request the company to repurchase their equity. The old company law did not provide for whether shareholders who object to the resolution of the shareholders’ meeting can request the company to repurchase their equity. The new company law stipulates this: The new company law stipulates: There are the following Under one of the circumstances, shareholders who vote against the resolution of the shareholders' meeting can request the company to acquire their equity at a reasonable price: (1) The company does not distribute profits to shareholders for five consecutive years, and the company has made profits for five consecutive years and is in compliance with the provisions of this Article. The conditions for profit distribution prescribed by law; (2) The company merges, splits, or transfers its main assets; (3) The business period stipulated in the company's articles of association expires or the articles of association enable the company to survive. If the shareholder and the company cannot reach an equity acquisition agreement within 60 days from the date of adoption of the resolution at the shareholders' meeting, the shareholder may file a lawsuit with the People's Court within 90 days from the date of adoption of the resolution at the shareholders' meeting. Restricting the voting rights of related shareholders and their directors. The new company law establishes a special section "Special Provisions on the Organizational Structure of Listed Companies" to stipulate independent directors, board secretaries and related transactions. The New Company Law stipulates that directors of listed companies who are related to the enterprises involved in the resolutions of the board of directors meeting shall not exercise voting rights on the resolution, nor may they exercise voting rights on behalf of other directors. The board meeting can be held if more than half of the unrelated directors are present, and resolutions made at the board meeting must be passed by more than half of the unrelated directors. If the number of unrelated directors present at the board of directors is less than three, the matter shall be submitted to the listed company's general meeting of shareholders for consideration. The new company law also stipulates: If a listed company purchases or sells major assets or guarantees the amount of which exceeds 30% of the company's total assets within one year, a resolution must be made by the shareholders' meeting and approved by two-thirds of the voting rights held by the shareholders present at the meeting. The above passed. Provide institutional support for the in-depth reform of wholly state-owned companies. In the chapter "Establishment and Organizational Structure of Limited Liability Companies", the new company law has a special section "Special Provisions for Wholly State-Owned Companies" to provide institutional support for its in-depth reform. The new company law stipulates that wholly state-owned companies do not have shareholders' meetings, and the powers of shareholders' meetings are exercised by the state-owned assets supervision and administration agency. The state-owned assets supervision and administration agency may authorize the company's board of directors to exercise some of the powers of the shareholders' meeting and decide on major matters of the company, but the company's merger, division, dissolution, increase or decrease in registered capital and issuance of corporate bonds must be decided by the state-owned assets supervision and administration agency; Among them, the merger, division, dissolution or bankruptcy application of important wholly state-owned companies shall be reviewed by the state-owned assets supervision and administration agency and then reported to the people's government at the same level for approval. The chairman, vice chairman, directors, and senior managers of a wholly state-owned company shall not hold concurrent posts in other limited liability companies, joint stock companies, or other economic organizations without the consent of the state-owned assets supervision and administration agency. A special chapter clarifies qualifications and obligations (1) Directors, supervisors and senior managers have obligations of loyalty and diligence to the company. The new Company Law stipulates that directors, supervisors and senior managers shall abide by laws, administrative regulations and the company's articles of association, and be responsible to the company. There is a duty of loyalty and diligence. Directors, supervisors and senior managers shall not take advantage of their powers to accept bribes or other illegal income, or misappropriate the company's property.
(2) When directors and supervisors fail to perform their duties, shareholders have the right to file lawsuits on behalf of the company. Establish a system for denying corporate legal personality. The new company law stipulates: If a company shareholder abuses the independent status of a company as a legal person and the limited liability of shareholders, evades debts, and seriously damages the interests of creditors, he shall be punished. The company bears joint liability.