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A more efficient derivative action system in China: challenges and opportunities through corporate governance theory

journal contribution
posted on 2023-06-08, 14:18 authored by Jingchen Zhao
The derivative action is an exception to the rule in Foss v Harbottle thatwas introduced with high expectations during a Chinese company law (CCL hereinafter) reform that came into effect in 2006. It is vital to combat the abuse of derivative action in China, a country with an emerging corporate governance model, a weak legal system and inefficient enforcement measures. This article examines several deficiencies in derivative actions, with the purpose of arguing for a more effective and positive derivative action rule for the benefit of shareholders and their companies, and also for the development of CCL and the reconstruction of the Chinese corporate governance system. Corporate governance theories will be discussed as theoretical supports for a more efficient and enforceable derivative action system in China.

History

Publication status

  • Published

File Version

  • Published version

Journal

Northern Ireland Legal Quarterly

ISSN

0029-3105

Publisher

Northern Ireland Legal Quarterly

Issue

2

Volume

64

Page range

233-253

Department affiliated with

  • Law Publications

Full text available

  • No

Peer reviewed?

  • Yes

Legacy Posted Date

2013-02-05

First Open Access (FOA) Date

2013-07-08

First Compliant Deposit (FCD) Date

2013-07-08

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