Reconstruction of the Characteristics of Member in Limited Liability Corporations:Expectations based on Members'Personal Relationships
The members'personal relationships is a characteristic of limited liability corporations widely recognized by the theoretical and practical circles of corporate law in China.Although the words the members'personal relationships have not been explicitly included in the law,relevant systems were created when Company Law of China was enacted in 1993.The affirmative position on the members'personal relationships has not fundamentally changed in the past thirty years.The new Company Law in 2023 continues the tradition without any breakthrough.In judicial practices such as shareholder qualifi-cation identification and equity transfer of limited liability corporations,the members'personal relation-ships has become the basis for judicial trials and has far-reaching influence.Looking at countries with common law systems and civil law systems,there are no legislative examples that classify limited liabil-ity corporation as a corporation with members'personal relationships.However,there is no legislation or interpretation of the members personal relationships in Company Law of China.In fact,a limited li-ability corporation does not have the a priori so-called characteristics of members'personal relation-ships.It should be a combination of contract and legal entity.In the future,when the Company Law is revised,the members'personal relationships and its system should be completely abolished.
limited liability corporationthe members personal relationshipscontractlimited liabilitylegal entity