东东东东东东东东东东东东
Name : 高阳 Num.: 511329016019
Mr. Ye、 and (Jiang’s mother in-law) joint contribution to
set up the Lide co., LTD. in Apr 18th of 2010, and a stake of 33%、
27%、40% respectively. The article appointed that the company director
for the valves and valve accessories production and sales, the
shareholders have the right to know the company’s operating and
financial conditions, and the supervisors have the right to check the
company’s financial. Mr. Jiang was appointed the executive director and
general manager, Mr. Ye was appointed the supervisor.
I have now had an opportunity to research the law on this point and I can
provide you with the following advice.
To represent the facts of the case, Mr. Ye conflicted with the
management in the process of the business management in Sep. 2011.
Mr. Ye reported to the public security organ that Jiang gang up with the
accountant deficit the public founds. The public security organ asked for
any related evidence, then Ye made request to consult the accounting
books of the company. But the company refused, so Ye appealed to the
court.
There are series of stipulations in the Company Law of China. Article 33
says that “Every shareholder may request to review the accounting books
of the company. Where a shareholder requests to review the accounting
books of the company, it shall submit a written request, which shall state
his motives. If the company, has the legitimate reason to believe that the
shareholder’s requests to review the accounting books has an improper
motive and may impair the legitimate interests of the company, it may
reject the request of the shareholder to review the books and shall,
within in 15 days after the shareholder submits a written request, give
the shareholder a written reply, which shall include an explanation. If the
company rejects the request of any shareholder to review the accounting
books, the shareholder may plead a people’s court to demand the
company to open the books for his review.”
Though there are no specific definitions of the word “explanation”,
generally, it always follow these rules:1) if the article appoints that the
company should deliver the financial and accounting book to the
shareholders periodically, when the shareholders perform their rights,
it’s reasonable, the company should provide the material in time. 2)
Lawsuits and disputes should not be the reason that the company refuse
to provide the materials. 3) All the shareholders who have the right to
know the pecuniary condition could perform their books of the access
rights, the company should not refuse for the reason that the
shareholders may disturb the operation of the company.
The article of Lide co,.LTD. appointed that shareholders have the right to
know the operating and financial conditions, and the supervisor has the
right to inspect the finance conditions. So Ye who’s the shareholder and
also the supervisor of this company ask to consult the accounting books
of the company is reasonably.
There has no prohibition of business strife between shareholders and the
company in the Company Law of China. As long as the shareholders’
actions do not constitute a malicious competition, they have the right to
supervise and be informed. Though Ye’s wife incorporated with the
company which managed the same projects with Lide co., Lide co. have
not proved that Ye had improper purpose to check the accounts, and it
may damage the interests of the company. Above all, Ye have no
confliction of interest with Lide co., so competitive industry relations
cannot be the determining factor of the shareholders’ rights to be
informed.
Shareholders’ rights to be informed are an important way to realize the
supervision and maintain the shareholders’ own interests, especially the
minority shareholders. Based on the above reasons, Ye may be
supported by the court.
