Question raising

A certain limited liability company is jointly invested and established by shareholders A, B, and C. According to the company's articles of association, each shareholder has subscribed to 1 million yuan, with a contribution period of December 31, 2023. As of December 31, 2023, both A and B have paid their contributions in full and on schedule, with only C contributing 100000 yuan. When the company was preparing to urge C to pay its capital contribution, it was unexpectedly discovered that C had no property available for enforcement due to a personal loan dispute, and had just been included in the list of dishonest defendants by the court. The company has determined that C is currently unable to make up for the difference in capital contribution, so it wants to remove C. However, there have been internal disagreements within the company regarding whether C can be delisted. So, in this situation, can the company remove C from the list?

Lawyer Interpretation

Regarding the rules for shareholder delisting, Article 17 (1) of Interpretation 3 of the Company Law stipulates that "if a shareholder of a limited liability company fails to fulfill their obligation to contribute or withdraws all their capital, and is urged by the company to pay or return it within a reasonable period of time, the company may terminate the shareholder's qualification by a resolution of the shareholders' meeting. If the shareholder requests confirmation that the termination is invalid, the people's court shall not support it.". Judicial precedents believe that although the aforementioned provisions recognize the termination of shareholder qualifications by the company, the application of this rule is limited to situations where shareholders have not fulfilled their investment obligations or have withdrawn all of their capital, as the method of terminating shareholder qualifications is more stringent and final compared to other remedies. Shareholders who have not fully fulfilled their investment obligations or have withdrawn part of their capital do not apply this rule. Therefore, the company cannot expel shareholder C who has not fully fulfilled its capital contribution obligations in accordance with the aforementioned provisions.

However, Article 52 of the new Company Law, which will come into effect on July 1, 2024, establishes a shareholder default system based on the aforementioned shareholder delisting rules. This system can solve the dilemma faced by the company where shareholders fail to pay their capital contributions in full and on time.

The shareholder call loss system refers to the situation where a shareholder fails to fulfill their capital contribution obligations on the date specified in the company's articles of association. If the company fails to fulfill the call, the shareholder will lose the equity of the unpaid capital upon notification by the company. The term "fulfilling investment obligations" here includes both unfulfilled investment obligations and unfulfilled investment obligations. The implementation process is as follows:

1. Issuance of call notice: The board of directors of a limited liability company (or directors if there is no board of directors, the same below) shall verify the shareholder's capital contribution. If it is found that the shareholder has not paid the capital contribution in full and on time as stipulated in the company's articles of association, the company shall issue a written call letter to the shareholder to call for payment of the capital contribution. At the same time, it is stipulated that the call for payment notice can specify a grace period for the payment of capital contributions, which shall not be less than 60 days from the date of the company issuing the call for payment.

2. Make a resolution of the board of directors: If a shareholder who fails to make full and timely contributions fails to fulfill their contribution obligations within the grace period after receiving the call letter, the board of directors shall make a corresponding resolution on the issue of issuing a notice of loss of rights to the shareholder.

3. Notice of Loss of Rights: The company shall issue a written notice of loss of rights to shareholders who have not paid their capital contributions in full and on time in accordance with the resolution of the board of directors. It should be noted that the time when the shareholder loses their unpaid equity is the date of the notice of loss.

After the company issues a notice of loss of equity, attention should also be paid to the subsequent handling of the loss of equity. The lost equity can be dealt with in the following ways: ① Transfer the equity in accordance with the law, or handle corresponding capital reduction and cancellation of the equity in accordance with the law; ② If it is not transferred or cancelled within six months, other shareholders of the company shall pay the corresponding capital in full according to their respective proportions of contribution.