On the company's articles of association on the function and development trends (the)

Keywords: Law / Articles of Association / Company ChArter

Summary: Articles of Association the company has been able to become a "chArter", simply because the Articles of incorporation has a unique function from the perspective of the internal structure of the company, articles of association and independent personality is established cornerstone of the shareholders the basis of autonomy, is Company managers guide to action, from the company's external relations, the articles of association to protect the company interests of internal and external participants, to promote internal staff as well as the interface between the state and company, company organization and company Laws to protect the harmony and promote the company's legal system innovation as the company changes the Law, the Articles of Association of the function also changes the articles of incorporation corporate governance gradually evolved into "charter."


Third, as the company's "charter" of the constitution - the Articles of Association of the Development trend of functional

(A function of the articles of incorporation of micro-trends analysis - to a number of key provisions of the Articles of Association for the object in many articles, I selected the company's capital terms and provisions of the purpose for the study of trends in the Articles of Association of the micro-scanning function. [1]

1.'s Purpose clause since the date of the birth of the Articles of Association, charter provisions have the purpose of the company's records, for example, pieces of the ship there and the health of the organization's contracts, the contracting purposes must be clearly documented, the company chartered in the period, King or charter issued by the State also must contain the purpose clause, but the purpose of this provision is to privilege the way - the company's external trade in the franchise - manifested in the establishment phase of the company guidelines, from the protection of the interests of investors departure, the purpose of the essential terms of the Articles of Association to become one of the conditions [2] The reason why traditional corporate purposes subject to national company Law provisions of the attention, one purpose of the Articles of Association in terms of explicit powers enjoyed by the company and the kind of power The limitations and constraints, as Cairn LC pointed out: "In terms of such a purpose, both the positive side, there are negative side, it provides certainty to the company by Law the scope of the powers enjoyed by and extent, and also negative to the provisions of the company shall not engage in any activities beyond the scope of its powers and shall not seek to have any company in this way than the purpose under the terms of the power of more power. "[3] Second, the purpose clause for the company to protect the interests of creditors, trading in their choice of cooperation or trading partners, the company must first consider the purpose, especially for the exclusive, proprietary product transactions, which can effectively prevent the risk of the transaction, the purpose of foreign companies engaged in prohibited conduct is to prevent abuse of the company's ability to protect the interests of creditors of the company. [4] Third, the terms for the shareholders of the Company's goal to protect the company's articles of association allow shareholders to grasp the purpose of provision of capital to invest in the company, while directors and other senior management personnel constraints abuses.

Modern society, with the purpose of the company's Development and evolution of the terms, the purpose of charter provisions recorded in the function has also undergone major changes. First, as recorded in the purpose clause in the Constitution the purpose of diversifying the company, especially the "engage in any lawful business "and other terms of the emergence of an abstract goal, the company continues to expand the scope of the powers of .20 1950s country (region's law in the gradual abolition of the company's" ultra vires act is invalid "principle, the company aims to further separation of power with the company, any company can enjoy power, unless the kinds of power under the Articles of Association of the ban. [5] and the UK <<1989 Act>> Section 108 is clear that "the company articles of association is not limited ability", "the effectiveness of the company's conduct does not According to its charter due to the lack of this power was suspect. "Therefore, the traditional purpose of the Articles of Association in terms of design constraints on the company lost the power of realistic basis, followed, unless the company charter the purpose of the use of specific terms, or in the company abstract terms the purpose of taking the case, the creditor can not learn from the charter company's record in the specific business content, and the company's capital is used to implement corporate purposes, there is no effective means to monitor the creditors, so the terms of the creditors of the company's goal of protection has been very weak. Finally, the terms of the corporate charter aim to protect shareholders and gradually increase the functionality, although countries (regional legislation on the company's "ultra vires act is invalid" principle has been amended, but still bears the directors to comply with the Articles of Association and corporate purposes within the scope of the terms of the obligations of the directors violated provisions of the Articles of Association in activities other than the purpose of the company and shareholders if the damage, unless exemptions, the directors must act ultra vires the company and its shareholders liable. [ 6] so that it can not from the shareholders of the company's control, the articles of association directors and other senior managers is still a guide to action.

2.'s Capital provisions in the Articles of Association in terms of features is recorded in the capital: first, the articles of association of the registered capital of credit record is to reveal the size of the company's bulletin board, will help traders understand the size of the company's capital, with risk prompts role in the second, also recorded in terms of charter capital, shareholders' investment in the form, amount, etc., in essence, constitute a shareholders agreement between the formation of the company's investors, the real and effective protection of shareholders investment in the absence of special agreement, these records also constitutes the exercise of shareholder voting rights, dividends, and assume responsibility for the fundamental basis for the third, the public offering of shares of the company, the law requires is written on the corporate charter company was authorized to issue securities of a class or information, this disclosure of tax returns or as part of, or released to the public as general information, not only the basis for state regulation of the company, is a public need for investors to understand the company's content.

But often, the company's longer, more difficult to determine from the company's capital assets of the company the company's external commitments which the property is the responsibility of the company's assets, rather than capital. "Clear to the company by the capital or the ability How many credit with virtual components. "[7] and with the Development of modern society, the authorized capital system and compromise is the world capital system in most countries (regions used.

Institutional change in the company's capital, many countries (regions or even eliminated in the company law provisions of the mandatory capital [8] on the basis of the above changes, the Articles of Association in terms of function as the capital has changed the one hand, in Articles of Association the company recorded total capital and operating assets of the company during the gap is changing, commonly referred to as "civil liability company's registered capital is the last line of defense" into a beautiful fairy tale. [9] terms of nominal capital allows the company to charter the role of foreign credit and publicity greatly reduced the other hand, due to changes in the company's capital and shareholder funding system is flexible, individual investors, specifically in the statute, especially the names of donors are objects, financed property, the price and given the appropriate type and amount of shares, become shareholders of a clear relationship between rights and obligations, funded status of public investors about the company's basic approach.

Through the company's charter corporate purposes and capital recorded in the analysis, although the point, but also reflects the company's articles of association functions, especially in the corporate charter mandatory items recorded functional change, first, an indisputable fact is that the corporate charter of the mandatory terms of external validity in a constant process of weakening, which features: First, the purpose clause of the charter no longer has the clear authority enjoyed by the company, the kinds of restrictions on the powers and the role of creditor protection, provision of capital of the virtual charter also makes the role of foreign credit and publicity greatly reduced, which are reflected in the articles of incorporation with the weakening of external security features. Second, the state law requires the company through the purpose and terms of fixed capital into the constitution, the absence of the above Terms of records will result in the invalidity of the Articles of Association, which shows that the state hopes to force items recorded in the articles of association records to achieve the company's control and regulation, but the purpose clause in the statute's terms of generalization and virtual capital of the conditions, the state recorded by the charter of the mandatory items to achieve the company's control and regulation functions are clearly tends to weaken. Secondly, the mandatory records in the corporate charter, but in matters of internal and gradually strengthen the effectiveness of the process in the purpose clause of the Constitution main role is to provide protection to shareholders, compared with clear terms of capital investment between the shareholders and the responsibility to provide direct share basis, so the matter is gradually becoming mandatory record "internal governance rules," playing the articles of incorporation as a company set up cornerstone and the foundation's independent personality, shareholders and company managers autonomy based guide to action functions.

(Two articles of association of the macro trends in functional analysis - to change the constitution matters recorded in the object

Modern company law for the mandatory requirements of the Articles of Association have shown a tendency to simplify, arbitrary items recorded in the company's articles of association .1950 expanding range of applications published in the United States <<Model Business Corporation Act>> Article 54 , submitted to the Secretary of State's file must contain certain mandatory elements, namely (a company name, (b term survival of the company, it can be permanent corporate purposes, can be summed up as "any legitimate business purpose for ", (d company was authorized to issue shares of the amount, including these shares and priority of information, (e company registered address and registered agent of the company registered the name, (f the names of the directors and the initial members of the Board name, address, (g each founder's name, address [10] in the 1980s the United States <<Model Business Corporation Act>> modified, its clear that unless the corporate charter provides for a "more limited the purpose "and the short duration, otherwise, each company has a" perpetual existence "and" engage in any lawful business operations of the purpose "of the property, the company need not repeat the provisions of the Articles of Association [11] If a company is only a single type of stock, and not by choice but by the initial board of directors for the creation of a single founder and the preparatory work, then (f terms "director's name and the initial members of the Board's name, address" can be deleted, and (d clause " Company is authorized amount of shares issued, including shares and priority of such information "can also be expressed in one sentence [12] In addition, the United States <<Model Business Corporation Act>> also clear that no records in the Constitution of the Company Law companies listed in the power, thus greatly reducing the Articles of the matters to be recorded content [13] civil law countries (regions is no exception, the original Japanese <<Commercial>> the provisions of section 166 of the Corporation 'charter absolute record business "is 10, while in Japan <<Law>> in the" constitution of the absolute record of the matter, "leaving only five, South Korea, <<Commercial>> and Taiwan of China," Company Law "also cut the Articles of Association in the matter of mandatory records. [14] Therefore, the two legal national (regional mandatory under the law of the articles of association tends to reduce the absolute record of matters, particularly in common law countries (regions of the records in the company's articles of association is very simple, such as the United Kingdom and China's Hong Kong Association of the Company only five, [15] and the U.S. company's articles of association are less easily printed on a postcard. [16]

Mandatory provisions in the Articles of Association dwindling at the same time, the expansion of modern company law statute showing a tendency of any items recorded in the United States, state corporate law to allow any of the articles of association records a wide range of institutional arrangements, including the company's objectives, such as corporate governance authorized shares of nominal value and type of shares, shareholders of the company's responsibility and conditions of the Professional Committee of the Board of Directors of the composition, managing director of compensation and limitation of liability, and insurance exemption does not conflict with any provisions of law. In addition, some U.S. state laws, company law can be relevant for some companies choose to apply the terms of governance, but this choice must be applied appropriately in terms of using articles of association is reflected [17] is is due to a large number of arbitrary terms in the company's articles of association in the introduction to a particular state of the United States in determining the rights of these model rules adopted must be careful to understand the state of the law, and outside your company to understand the organization and operations of the company When you must carefully review the articles of association. Therefore, in order to make these laws differ from the terms of those who do not know their people and to make binding provisions on internal governance more effective, easy to modify, in practice companies often place these provisions of the Constitution of the Company in, while in the company details to be repeated, a trend in civil law countries (regions limited liability company articles of association rules in performance was also very obvious, for example, Germany <<limited liability company>> Most of the articles of association terms of the provisions are arbitrary, limited liability company contains the rules of corporate governance, such as the appointment of the manager of the company's requirements, company managers and shareholders of the division of responsibilities, procedures for convening the shareholders [18] from within the company perspective, the articles of association under the Companies Act to force the line items recorded on the reduction of any documented issues with the increase mainly related to many aspects of governance within the company to shareholders in the charter not only within the limits prescribed by law free to agree on the matter even The default while the self-exclusion laws designed by the company charter eclectic design to create the conditions for the diversification of the company's constitution to become shareholders of a stage of autonomy, and advance arrangements through the constitution provide the basis for the autonomy and protection of shareholders with this Meanwhile, the Articles of Association related to the company operating the most basic rules and the internal power configuration, the rules are the law of the highest position within the company. Articles of Association in a variety of institutional arrangements as a constraint to the main basis for the power company managers, shareholders and even can be based on Articles of Association sued the company, the law enforcement provisions in the company's shrinking, managers will be more based on the articles of association to obtain a guide to action, so the articles of incorporation reflecting the change in the matters recorded in the company bylaws in effect the value of corporate governance increasingly strengthened.

From outside the company point of view, the civil law company law matters recorded in the articles of association is absolutely necessary, and the common law's the law of the Company's Articles of recorded matters produced, mostly rooted in the establishment phase of the company's charter franchise in the record , represents the state of public power for private social body - Organization - penetration, but also represents the state attempts to pass legislation to set strict access conditions and the company aims to clear the intention of reducing transaction risk, however, as society Development, as recorded in the company charter provisions and the purpose of functional changes in terms of capital, growing awareness of the limitations of force interventions. State intervention affected the company's operating efficiency and to respond flexibly to the market, the company in order to get rid of the shackles of national mandatory rules to take measures to circumvent the law, leading to ultra vires acts, false investment, capital flight and other violations occur, not only the destruction of social credit, will increase the country's judicial costs.

Links to free download http://www.hi138.com

Broadly speaking, the state's autonomy with the shareholders of the target with some degree of consistency, they want the company efficient, fair competition, no abuse of power and the flexibility to maintain commercial mechanisms. [19] when the company sought through a variety of means to get rid of mandatory national provisions of the statute of bondage, and the articles of incorporation record the mandatory role of virtual items has become an indisputable fact that under the conditions, countries should adopt a pragmatic approach to reduce or simplify company legislation in force on the articles of incorporation of items recorded Simplify the mandatory items recorded in the Constitution, of course, is most affected by the external effect of the articles of incorporation, articles of association, especially the weakening of the role of external publicity, reducing the company's articles of association of security and the "safety valve" function [20] In fact, When the state direct control of the means involved in corporate governance, this despite the company as an autonomous organization with the nature of conflict, but in the lower level of the market economy in the case of this conflict is not obvious. With the increased market-oriented and business-to-business demand for enhanced efficiency and flexibility, a large number of mandatory company law rules limiting shareholder autonomy hinders other aspects of institutional arrangements in the ability of independent innovation in the "competition and Development" has become the premise of the company law reform topics , the [21] more countries to indirect method - known as tissue type, reactive or flexible type of indirect management - trying to create a basic framework for the company by the shareholders on the basis of autonomy in to act independently within the framework of national law, to achieve a self-balancing and self-development, in order to achieve the goal of national control. Clearly, reducing the mandatory legal statute and increase recorded in any of the matters recorded in the practice matters, it is country into a control mode kinds of expression, so the articles of incorporation with the state still plays a connecting link between the company and the "connected device" function. In addition, the transformation of management and the state constitution in any items recorded increases, the company articles of association in the legal framework of rules by arrangement design their own special needs of a variety of systems and articles of association of the "lubricant" function to play, not only to make the company more room for self-development and innovation, it is obvious that the company will promote the diversification of development and institutional innovation.

So, from both within the company perspective or from outside the company point of view, the articles of incorporation of functional changes in the trajectory is clear, and its related companies outside personnel functions - such as "safety valve" function - tends to weaken, while the internal as an independent personality cornerstone shareholder autonomous basis, the company management behavior guidelines and "connected" and "A lubricant" function will tend to strengthen the company articles of association for companies and further into the corporate governance rules within the collection will Articles of Association as "the charter" may have great care of too, but called it the "corporate governance charter," is undoubtedly appropriate.

[Primary reference]
1.Robert W. Hamilton, The Law ofCorporations, (4th edition, Los Angeles: West Group Publishing, 1996.

2.Paul L. Davies, ed, Gower'sPrinciple ofModern CompanyLaw, (6th Edition, London: Sweet & Maxwell, 1997.

3.Frank H. Easterbrook and Daniel R. Fischel, The Economic Structure ofCorporate Law, Harvard University Press, 1991.

4 Shi Ji-Chun: <<business and corporate law>>, China Renmin University Press, 2008 edition.

5. [Japanese] Hisao: <<History of the Development Corporation>> Enterprise Lin, M. Hu, the Chinese People's University Press, 2002.

6. Wenshi Yang, Liao Huanguo: "articles of association and autonomy>> set editor Wang Baoshu: <<Commercial Essays>> (Volume 6, Law Press, 2002.

7 Deng Feng: <<As the legal community: a theoretical framework for reconstruction company>> set <<foreign law>> 2004 6.

[Notes]
[1] was chosen as the study of these two terms, on the one hand, corporate purposes and capital provision in terms of civil law countries (regions is absolutely necessary for the constitution of the items recorded in the common law countries (regions belonging to the company's articles of association category. and the function of these two items recorded more comprehensive coverage, both external effect, also has a relationship within the company to adjust for the effect on the other hand, these two terms as the company's legal system and the development of items recorded in the company's articles of association or the status of records in both the content of all significant changes have taken place, so choose the terms of these two studies is not only universal, can take care of Two Schools of major countries (regions of the law, but also has significant nature, can more clearly outline the evolution of the trajectory function Constitution.

[2] Wenshi Yang, Liao Huanguo: <<articles of association and autonomy>> containing the tree editor Paul King: "Commercial Law Essays>> (Volume 6, Law Press, 2002, p. 13.

[3] Ashbury Railway Carriage Co, v.Riche (1875 LR7H.L.653. Quoted from Zhang CAS: <<'s purpose clause of>> load <<Sun Yat-sen University>> 1998 3.

[4] See Note [3]
[5] Robert W. Hamilton, The Law of Corporations, (4th edition, Los Angeles: West Group Publishing, 1996, pp.68-69.

[6] For example, the United States <<Model Business Corporation Act>> provisions, shareholders can ask the program in the following ultra vires of the problem: (1 in by the company (or a representative of the shareholders of the company's current or retired staff or director of its lawsuit filed in the grounds of ultra vires, (2 ..., (3 shareholders of the company filed against the implementation of the ultra vires acts or movable and immovable property of the ultra vires transfer of proceedings ... 6.See note [5], pp. 68-69. [5], pp.68-69.

[7] Zhao Xudong: <<from the capital assets of the credit to the credit>> set <<Legal Studies>> 2003 5.

[8] The United States almost all states have abolished the company's minimum capital requirements, because "any minimum capital requirements are arbitrary and can not provide meaningful protection for creditors". See note [5], p.57 .

[9] See Note [2], p. 17.

[10] See note [5], pp.47-48.

[11] See United States <<Model Business Corporation Act "Section 3.01, Section 3.02.

[12] See note [5], p.48.

[13] See Shitian Tao: <<Law on>> Legal Press, 2005, p. 151.

[14] See Republic of Korea <<Commercial>> Article 289, Taiwan, "Company Law" Article 129.

[15] See [United Kingdom] RG Spellings, R. Jeffries: <<>>,<< UK Companies Act>> translation team Translation, Shanghai Translation Publishing Company, 1984, Page, Han-cha: <<Hong Kong company law theory and practice>> Popular Science Press, 1994, p. 355-362 pages.

[16] See note [5], p.48.

[17] For example, some U.S. state laws, including <<Model Business Corporation Act>> Section 6.30, Section 7.28 provides that shareholders do not enjoy pre-emptive rights or cumulative voting rights, unless the company articles of association expressly provided in this . See note [5], pp.48-49. [5], p.48.

[18] See [Germany] Thomas Lai Saier, Rüdiger. Fayi Er: <<German-owned co-Law>>, GAO Jun, M., Law Press, 2005, p. 408-409 pages.

[19] See Note [2], p. 20.

[20] See Wang Baoshu: <<Competition and Development: the theme of facing the Company Law Reform>> set <<Modern Law>> 2003 3.

[21] but this does not represent the company's security system and company law to protect the overall function of weakening, while the Constitution "safety valve" function of the weakening of the company's external traders can still understand the daily business reputation by signing a contract and complete the company's bankruptcy system, etc. to be filled. so this weakening does not affect society as a whole transaction security.

Links to free download http://www.hi138.com