[Key points of this case] For the confirmation of shareholder qualifications, a comprehensive review should be conducted from both substantive requirements and formal requirements: substantive requirements refer to fulfilling the capital contribution obligation and enjoying share

[Key points of this case]

The confirmation of shareholder qualifications should be conducted from the two aspects of substantive requirements and formal requirements: substantive requirements refer to fulfilling the capital contribution obligation and enjoying shareholder rights such as participating in company decision-making and shareholders' right to know; formal requirements refer to the records and proof of shareholder capital contributions; only by meeting the above two points at the same time can the confirmation of shareholder qualifications be truly completed.

【Basic Case】

A Company was registered and established by the Beijing Municipal Administration for Industry and Commerce on July 25, 2004. Its business scope is to prepare for construction of building materials projects. As of May 13, 2017, Company A registered shareholders were Chen, Yang and Lin, with a registered capital of 10 million yuan, and its business scope was changed to the production and sale of xx new building materials. The legal representative of the company is Chen Moumou.

On June 4, 2018, Chen Moumou convened some shareholders of Company A and new investors such as Zhang Mouqing, representing the investor of 85% of the company's share, presided over a meeting with the topic "Adjustment of shareholder members and investment amount changes", and in the form of "A Building Materials Co., Ltd. Board resolution" (A Company did not establish a board of directors), he determined the adjusted shareholder members who accounted for 26.5 million yuan in 85% of Company A's investment share, of which Zhang Mouqing was the company's newly added "shareholder" with a capital contribution of 4.6 million yuan (two days ago, on June 2, Company A had confirmed that Zhang Mouqing's investment amount was 4.6 million yuan, and issued a receipt to Zhang Mouqing).

Subsequently, Company A did not issue a capital contribution certificate to Zhang Mouqing, or recorded it in the shareholder list, nor did he handle industrial and commercial change registration in accordance with the above resolutions, and registered Zhang Mouqing as a shareholder of the company.

A Company contracted the company for nine years on November 22, 2021, but did not inform Zhang Mouqing. After Zhang Mouqing failed to obtain the industrial and commercial registration of his capital share in writing ("Notice") on April 19, 2022, he mailed the "Notice on Terminating the Contract Relationship of "Capital Increase and Share Expansion"" to the company through notarization on June 24, 2022, requesting that the above-mentioned 4.6 million yuan "Capital Increase and Share Expansion" contract relationship between him and Company A be terminated and the refund was made.

On June 26, 2022, Zhang Mouqing sued the court, requesting a ruling: 1. Confirm that the contractual relationship between the capital increase and share expansion between the two parties was terminated on June 25, 2022; 2. Company A returns 4.6 million yuan of investment funds and compensates for the interest loss occupied by the funds (calculated at a monthly interest rate of 1% from June 3, 2018 to the date of repayment determination, temporarily accounting for 2.208 million yuan on June 2, 2022); 3. The litigation costs shall be borne by Company A.

[Court Trial]

After trial, the court held that this case was a case of a dispute between a limited liability company and a new investor due to whether the shareholders enjoyed the rights of the new investor after the new investment was added.

After Zhang Mouqing completed the capital contribution to Company A, Company A did not issue a proof of equity to Zhang Mouqing, did not record Zhang Mouqing in the shareholder list, nor did he make changes to the industrial and commercial administrative department, and even did not inform Zhang Mouqing of this important matter of nine years of external contracting. Zhang Mouqing neither has the requirement of formal shareholder status nor enjoys the substantive rights of shareholders. Zhang Mouqing has never been a shareholder of Company A's "legal sense". In the defense,

A Company clearly stated that "Zhang Mouqing's equity in Company A no longer exists." It can be seen that Zhang Mouqing's purpose of investing in Company A can no longer be achieved. Therefore, it is correct for the court to confirm that the legal relationship of the new capital subscription confirmed by both parties has been terminated. Company A shall immediately return 4.6 million yuan of investment funds to Zhang Mouqing and shall compensate Zhang Mou's interest losses based on the benchmark interest rate of the same loan of the same period from the day after the investment funds are collected.

In summary, the court's final judgment is as follows:

1. A Building Materials Co., Ltd. returns Zhang Mouqing's investment amount within ten days from the date of effectiveness of this judgment and compensates for interest losses (interest calculated at the benchmark interest rate of the same type of loan in the same period from June 3, 2018 to the date of actual repayment within the performance period determined by this judgment);

2. Dismiss Zhang Mouqing's other litigation requests.

[Lawyer Analysis]

In combination with this case, Facaida should also remind investors: Inviting others other than the original shareholders to contribute capital is a common way for the company to increase capital, and a way for the company to adjust the shareholder structure and shareholding ratio. However, the company should realize that if the investor subscribes the capital, if he has not obtained the shareholder qualification for a long time, he may ask the company to return the subscription funds or file a lawsuit for confirmation of shareholder qualifications.

According to Article 43 of the Company Law, the increase of registered capital requires a special resolution by the shareholders' meeting, and then the company and the stockholders sign a capital increase agreement. When will the subscriber obtain shareholder qualifications, it should also be analyzed based on legal relations.

First of all, a consistent expression of intention must be formed between shareholders and subscribers, and between subscribers and companies. Generally speaking, valid shareholders' meeting resolutions and capital increase agreements can be directly used as evidence to prove that the intention is consistent. In the absence of shareholders' meeting resolutions, but the subscribers have actually participated in the company, enjoyed and exercised shareholder rights, but other shareholders have not raised objections, it should also be considered that a consent has been formed between the shareholders.

Secondly, the capital contribution of the subscriber must constitute the company's registered capital. The object of equity is the capital contribution share reflected in the company's registered capital. If you want to become a shareholder, you must convert the actual or subscribed capital you have paid or subscribed into the company's registered capital. Otherwise, if the investor's investment is not reflected in the company's registered capital, then the equity object corresponding to the investment has not been created yet, and the corresponding equity cannot exist.

Third, shareholder changes must be recorded internally in accordance with the law, externally in accordance with the law, and shareholders must be registered essentially in accordance with the law, and shareholders shall essentially enjoy shareholder rights such as participating in company decision-making and shareholders' right to know.

In short, only by meeting the above conditions can shareholders be identified as "legal" shareholders. It must not be believed that as long as the investor fulfills his capital contribution obligation, he will naturally obtain his shareholder status. Therefore, after the new investor invests in the shares, the company must promptly record and register in accordance with the relevant provisions of the Company Law to ensure that shareholders enjoy real shareholder rights.