Point of view... How to determine that the purpose of shareholders requesting access to the company's accounting books is improper.
Published:
2021-12-23
According to Article 33 of the Company Law, if a shareholder requests to consult the company's accounting books, he shall submit a written request to the company stating the purpose. If the company has reasonable grounds to believe that the shareholders' access to the accounting books has an improper purpose that may harm the legitimate interests of the company, it may refuse to provide access. It can be seen that the legitimate purpose of the shareholders' access to the company's accounting books will be directly related to the realization of the right of access. Then, how to determine the legitimacy of the right of inspection in judicial practice? As a company, how to prove that the right of inspection claimed by the plaintiff shareholders has an improper purpose? According to the provisions of Article 8 of the (IV) of the Supreme People's Court on Several Issues Concerning the Application of the the People's Republic of China Company Law, the shareholders of the company have one of the following four situations: the people's court shall determine that they have an "improper purpose": (1) If a shareholder operates a business for himself or for another person that has a substantial competitive relationship with the company's main business, it shall be deemed to have an "improper purpose." The "self-employed" here refers to the business operated by the shareholders themselves; the "main business" here refers to the business of the main source of the company's profits; and the "substantial competitive relationship" here refers to the direct conflict of interest between the shareholders and the company. However, if there is such a relationship between the shareholders and the company, but the articles of association of the company provide otherwise or all shareholders agree otherwise, the treatment in accordance with the provisions or agreement may not be regarded as "improper purpose". (2) If a shareholder consults the company's accounting books in order to inform others of the relevant information, which may harm the legitimate interests of the company, it shall be deemed to have an "improper purpose." "Relevant information" here refers to the information contained in the company's accounting books. The purpose of a shareholder's access to the company's accounting books is not to exercise his or her rights as a shareholder, but to inform others of the information he or she has accessed, which should be deemed to have an "improper purpose" as long as it has the possibility of harming the legitimate rights and interests of the company ". (3) If a shareholder, within three years prior to the date of making a request for inspection to the company, has informed others of relevant information that harms the legitimate interests of the company by consulting the company's accounting books, it shall be deemed to have an "improper purpose". The term "within three years" here refers to the three years before the date of the shareholder's request for inspection to the company, not the three years before the date of the shareholder's lawsuit in the people's court. If a shareholder has "consulted the company's accounting books and informed others of relevant information that harms the legitimate interests of the company" within three years before the date of filing a request for inspection to the company, it shall be deemed to have an "improper purpose". (4) Other circumstances in which the shareholders have improper purposes. This is a bottom-up clause. Due to the complexity of the actual situation, legislation cannot exhaust all the circumstances of "improper purposes", so more facts are handed over to the people's court for truthful determination.
According to Article 33 of the Company Law, if a shareholder requests to consult the company's accounting books, he shall submit a written request to the company stating the purpose. If the company has reasonable grounds to believe that the shareholders' access to the accounting books has an improper purpose that may harm the legitimate interests of the company, it may refuse to provide access. It can be seen that the legitimate purpose of the shareholders' access to the company's accounting books will be directly related to the realization of the right of access. Then, how to determine the legitimacy of the right of inspection in judicial practice? As a company, how to prove that the right of inspection claimed by the plaintiff shareholders has an improper purpose? According to the provisions of Article 8 of the (IV) of the Supreme People's Court on Several Issues Concerning the Application of the the People's Republic of China Company Law, the shareholders of the company have one of the following four situations: the people's court shall determine that they have an "improper purpose":
(1) If a shareholder operates a business for himself or for another person that has a substantial competitive relationship with the company's main business, it shall be deemed to have an "improper purpose."The "self-employed" here refers to the business operated by the shareholders themselves; the "main business" here refers to the business of the main source of the company's profits; and the "substantial competitive relationship" here refers to the direct conflict of interest between the shareholders and the company. However, if there is such a relationship between the shareholders and the company, but the articles of association of the company provide otherwise or all shareholders agree otherwise, the treatment in accordance with the provisions or agreement may not be regarded as "improper purpose".
(2) If a shareholder consults the company's accounting books in order to inform others of relevant information, which may harm the legitimate interests of the company, it shall be deemed to have an "improper purpose."Relevant information" here refers to the information contained in the company's accounting books. The purpose of a shareholder's access to the company's accounting books is not to exercise his or her rights as a shareholder, but to inform others of the information he or she has accessed, which should be deemed to have an "improper purpose" as long as it has the possibility of harming the legitimate rights and interests of the company ".
(3) If a shareholder, within three years prior to the date of making a request for inspection to the company, has informed others of relevant information that harms the legitimate interests of the company by consulting the company's accounting books, it shall be deemed to have an "improper purpose".The term "within three years" here refers to the three years before the date of the shareholder's request for inspection to the company, not the three years before the date of the shareholder's lawsuit in the people's court. If a shareholder has "consulted the company's accounting books and informed others of relevant information that harms the legitimate interests of the company" within three years before the date of filing a request for inspection to the company, it shall be deemed to have an "improper purpose".
(4) Other circumstances in which the shareholders have improper purposes.This is a bottom-up clause. Due to the complexity of the actual situation, legislation cannot exhaust all the circumstances of "improper purposes", so more facts are handed over to the people's court for truthful determination.
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