On October 27, lawyer Zhan Feiyang, founding partner of Beijing Fuding Law Firm, took his new work "Company Compliance-The Founder's Law on Avoiding Failure" as a guest on the micro-interview of "Dialogue with Legal Person" initiated by Toutiao Finance Channel, and shared his wonderful views on hot issues in the field of company compliance. @Peking University Dharma School is a special support organization for this micro-interview.
Zhan Feiyang Lawyer is currently a member of the venture capital and private equity professional committee of the Beijing Lawyers Association. He has provided legal services to many leading private equity investment institutions in China. He has also served as legal advisor to many high-growth companies and their founders. He provides solutions to enterprises in convenient equity financing, structural restructuring, acquisitions and mergers, equity incentives, compliance operations, crisis management, etc.
Strengthen compliance management . Preventing compliance risks is a new trend in the development of global enterprises. In recent years, my country has also been vigorously strengthening corporate compliance construction, especially in 2018, the country issued national compliance standards. Compliance management is no longer limited to state-owned enterprises, central enterprises and large private enterprises, but also includes a large number of small and medium-sized enterprises. The construction of a complete compliance system requires a lot of cost investment, which is often difficult for small and medium-sized enterprises to bear. How to help corporate founders quickly solve the confusion of company compliance operations and improve corporate compliance management at the lowest cost has become a research topic for lawyer Zhan Feiyang, which has also become his original intention of writing the book "Company Compliance".
This micro-interview involves many issues in the fields of entrepreneurs' property protection, antitrust, financial management, equity financing, human resources management, entrepreneur criminal risk, etc. We will share it with readers in two sections. The following is the transcript of the second interview.
Taking online music as an example, what are the difficulties in identifying Internet monopoly?
Since my country's " Anti-Monopoly Law " officially came into effect on August 1, 2008, anti-monopoly law enforcement has been continuously strengthened and deepened, and the "Anti-Monopoly Law" has gradually penetrated into various fields, including of course the Internet field. The focus of online music has shifted to "anti-monopoly" and is a reflection of the strict law enforcement of the Anti-monopoly Law. All enterprises can do is learn to deal with this "new normal" implemented by the Anti-Monopoly Law.
On September 1 this year, in order to cooperate with anti-monopoly law enforcement, the "Interim Provisions on Prohibition of Abuse of Market Dominance" formulated by the State Administration for Market Regulation has preliminarily determined some special considerations for how to determine the market position of Internet operators. For example, factors such as competitive characteristics, business models, number of users, network effects, lock-in effects, technical characteristics, market innovation, ability to master and process related data, and the market power of operators in related markets can be considered. However, this is only a principled guiding opinion. How to define relevant markets, determine market dominance and abuse market dominance in practice will be more complicated, and there are more factors that need to be considered. Therefore, the boundaries of Internet antitrust are often difficult to grasp.
Online music field As the giants reach copyright cooperation and achieve mutual authorization, the "copyright dispute" between platforms has gradually subsided. However, the copyright barriers previously established by online music platforms have not completely disappeared. Some platforms may still monopolize upstream resources by signing exclusive licensing agreements with copyright owners with anti-competitive effects, thereby eliminating and restricting market competition in the online music field. Of course, an exclusive licensing agreement cannot be directly equated with monopoly. Intellectual property itself also has the characteristics of proprietary , exclusivity and exclusiveness. The application boundary of antitrust law in the field of online music still needs to be investigated and demonstrated in depth. There are few precedents of antitrust laws regulating online music abroad. Therefore, it is necessary to be very cautious in regulating online music with antitrust laws.
In the future, anti-monopoly-related laws and regulations will be improved one after another, and investigation and law enforcement will become more mature. Enterprises must conduct their own anti-monopoly compliance reviews, build a complete anti-monopoly compliance system, and respond to changes in the same way as they remain unchanged. A strategy summarized in the book, "The Way to Response to Anti-Monopoly Compliance Review", is of some help to enterprises prevent the risks of anti-monopoly review.
Avoid "carrot seals". How should enterprises improve the seal usage mechanism?
"Carrot seal" has always been a high-risk event in the operation of enterprises and is also a key point in corporate legal risk control. Prevention is better than remedy. In order to prevent the forged official seals from causing legal risks, enterprises should take precautions from the following aspects:
(I) Before engraving seals, enterprises should apply for filing with the public security department and engrave seals with anti-counterfeiting logos.
(II) Improve internal seal storage and use rules and regulations, ensure that seals are kept by a dedicated person and registered with each seal, and verify whether the seal on the document is within the registration ledger to identify forged official seals.
(three) Avoid multiple engravings in one chapter. The company only has one official seal, which will greatly reduce the difficulty of identifying forged official seals. If the company has multiple seals, records of public use should be retained, and forged seals should not be used publicly in multiple places.
(IV) When signing legal documents, try to sign the contract in a "seal + signature" manner to increase the degree of anti-counterfeiting.
(V) If an enterprise replaces seals and destroys old seals, it shall archive old seals and seals and publicize the use of new seals to prevent counterfeiters from replacing old seals with fake seals.
(VI) Article 280 of my country's Criminal Law stipulates the crime of forging and altering seals. If a seal is found to be forged, the case should be reported to the public security organs in a timely manner, and the forgers should be held legally responsible in accordance with the law to prevent the damage from expanding.
How to comply with the "two sets of accounts" of corporate finance, internal and external?
Enterprises' two-set account practice does not comply with the provisions of my country's "Accounting Law" and tax law, and accountants bear great risks. If an enterprise wants to avoid the risk of financial violations, it must integrate the two accounts, reunite all information into a financial management system, conduct unified accounting, and fully and truly reflect the company's various businesses. Specifically, we can start from the following three points:
1. Both external and internal accounts are incomplete accounts. In terms of the most core sales, procurement and production, the ERP system data of the warehouse and production line should be based on the missing parts of the external accounts, and the difference in the relevant sales and procurement transactions is confirmed as shareholders' collection and payment, and the final net amount needs to be repaid by shareholders or paid by the company.
2. The estimated tax costs and shareholder repayment of the two sets of accounts must be dealt with as soon as possible. After the merger, the value-added tax and income tax generated by the confirmed purchase without tickets must be paid as soon as possible.
3. Determine the company's core assets through inventory and fixed asset inventory, determine the asset list according to the correct accounting method, and adjust the financial accounts based on facts.
When financing equity of startups, how to reasonably set " veto "?
"Veed veto" is a rule of procedure in corporate governance and a method of arrangement of control in equity layout. As a tool, it doesn't matter whether it is right or wrong, nor is it a disaster and cannot be rejected. Whether the founder should give investors a veto depends on various factors such as the investment stage and equity ratio. To reasonably set a veto and ensure effectiveness, there are several points for reference:
1. Without violating the mandatory provisions of laws and regulations, a veto can be set in accordance with the principle of shareholder autonomy, but only for limited liability companies. The " Company Law " does not allow shareholders to make independent agreements on the board of directors of joint-stock companies, and they cannot set up a "veto power" on the board of directors of joint-stock companies.
2. Try to ensure that the equity financing agreement is consistent with the company's articles of association, and avoid the veto clauses in the equity financing agreement. Due to omissions or industrial and commercial registration restrictions, there are no relevant provisions in the target company's articles of association. The articles of association can add an appropriate guarantee clause similar to "whether the matters not agreed in the articles of association, shareholders may agree separately in writing".
3. The veto power should be limited to major matters. The founder can reasonably limit the scope of investors' veto power. It is recommended not to give veto power easily for early investors.
4. One vote veto as a special right arrangement conflicts with the "standardized operation" required by listed company governance, so the target company should clear the one vote veto clause before applying for an IPO.
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