Interview with reporters at the LEI national two sessions

March 6 Noon News, Jinshan and Millet company chairman, National People's Congress lei during the two sessions issued amendments to the "Company law" proposal, he thought should be amended by law, to the preferred shares of the voting rights to further give a clear standard, at the same time preferred shareholders should take the right to enjoy the relevant property priority.

The following is the full text of Lei's recommendations on amending < company Law > preferred terms to improve the entrepreneurial environment:

NPC Representative: Lei

It is very common for venture capital to finance in China, and the characteristics of preference shares are fully embodied in the venture capital enterprises.

In the present judicial environment of our country, if we do not revise the 104th and 187th of the existing company law, it will increase the uncertainty risk of venture capital, which may ultimately harm the interests of both investors and entrepreneurs, and thus affect the environment of the enterprise.

The positive effect of preferred stock system on improving venture environment

The main advantage of the preference system to the development of venture capital Enterprise is: For investors, it is advantageous to control the risk, can effectively guarantee the investor's interest, arouse the enthusiasm of the risk investor; for the entrepreneur and the company, can increase the capital to solve the company financing problem, reduce the ratio of assets and liabilities, So that the company has long-term development momentum, for the community, conducive to encourage entrepreneurship, optimize the allocation of resources, social and economic development plays a role in promoting.

The positive significance of preferred shares is obvious, there are some shortcomings: because of the inconsistency of shareholder equity, it may lead to disputes between shareholders, and then affect the company's stable operation. In comprehensive consideration, the preference system benefits far outweigh the disadvantages. The establishment of perfect preferred stock system is the intrinsic demand and inevitable trend of market economy.

The time is ripe for amending the terms of preferred shares in the company law

Through years of exploration and practice, our government and the public have a more profound understanding of preferred shares, and gradually understand the rationality and necessity of preferred stock. November 30, 2013 the State Council issued the State Council on the implementation of preferred shares of the guidance of the pilot, is our country to carry out preferred shares pilot, the basic legal document. December 13, 2013, the SFC issued the "Preferred Stock pilot management measures (draft)" and open for comments to facilitate the implementation of preferred shares of the pilot distribution and trading work, basically covering the industry and investors concerned about the main problem. After years of exploration, the soil and conditions of the legal system of the development of preferred shares in China are already available.

Proposed amendments to the terms of preferred shares in the company law

China's current "company law" does not specify the preferred shares, according to the "Law without prohibition is allowed" principle, China's current "company law" does not prohibit the existence of preferred shares, but the existing "company law" 104th and 187th has actually hindered the development of preferred shares, proposed to amend the relevant provisions.

(a) Amendment of the existing company law 104th

China's current "company law" 104th of the first paragraph stipulates: "Shareholders attend the meeting of shareholders, the holding of each share has one vote." However, the shares of the company held by the company do not have the right to vote. "The existence of no voting shares is not permitted in accordance with the provisions of this provision, not only with the provisions of 43rd of the existing company law:" The shareholders ' meeting shall be exercised by shareholders in accordance with the proportion of contributions, except as otherwise provided in the articles of incorporation. "(allowing the incorporation of articles of association) is inconsistent and contradictory to the inherent characteristics of preferred Shares: Preferred shares generally do not have the right to vote." The proposed amendment to the article is as follows: "Shareholders attend meetings of the general Meeting of shareholders, the holding of each ordinary shares have a vote, except as otherwise provided in the articles of incorporation." However, the shares of the company held by the company do not have the right to vote. "This allows the voting rights of preferred shares to be regulated through the Articles of incorporation."

(ii) Amendment of 187th of the existing company law

China's current "company law" 187th of the second paragraph stipulates: "Corporate property in the liquidation costs, workers ' wages, social insurance costs and statutory compensation, pay the tax owed, the liquidation of the company's debts of the remaining assets, limited liability company in accordance with the proportion of shareholders ' contribution, The stock company is divided according to the proportion of shares held by shareholders. "According to the provisions of this article, the preferential shareholders will not be able to enjoy an important part of the preferred stock of" surplus property distribution rights ", it is difficult to give priority to the liquidation of the remaining property. The proposed modification is as follows: "The assets of the Company shall be distributed in proportion to the shareholders with priority distribution stipulated in the Articles of association by paying the liquidation expenses, the wages of the workers, the social insurance expenses and the statutory compensation, paying the taxes owed, and the remaining property after the liquidation of the company's debts, In accordance with the general shareholders of the proportion of capital contribution or the proportion of shares held. ”

As an important factor of the new economic system, the preferred stock legal system plays a positive role in solving the problem of enterprise financing and expanding the new investment and financing channel, which is also necessary to promote the transformation of production mode and the development of productive forces. In view of this, it is imperative to revise the legal provisions for the development of the bound preferred stock system, to revise the 104 articles and 187 articles of our current "company law" to adapt to the development of preferred stock system, which has become an urgent problem to be solved, and it is necessary to mention the agenda quickly.