Related Party Transactions—Related Party Transactions in Affiliated Enterprises

• Main Authors: Yu-Hsuan Liu, 劉于萱
• Other Authors: 曾宛如
• Format: Others
• Language: zh-TW
• Published: 2013
• Online Access: http://ndltd.ncl.edu.tw/handle/97731964075898663344

碩士 === 國立臺灣大學 === 法律學研究所 === 101 === There is always room to discuss whether we should permit the related party transactions in law policy. In fact, because the insiders owe fiduciary duty to the companies, and the interests of companies are more important than their own interests, it seems to be reasonable to prohibit the related party transactions. However, there are still some essential interests to the companies, so it is not proper to forbid completely. Observing the laws of Taiwan, we allow the related party transactions and regulate the relevant behaviors. This thesis begins with the related party transactions in Taiwan. In addition to de jure responsible persons, the person who can substantially control the affairs of companies shall be subject to the rules that are associated with the related party transactions. Besides, this thesis focuses on transferring the assets of companies, offering loans and providing guarantees. Additionally, how decision-making mechanism and monitoring mechanism to operate are the issues that can not be ignored in related party transactions. For the purpose of making the best policy to the companies, the related persons shall disclose sufficient information. Last but not least important are the validity of illegal transactions and the responsibilities of related persons. To be honest, there is still much room to improve in Taiwan’s laws, so that we shall consider advanced foreign laws. In American laws, this thesis adopts Delaware General Corporation Law, Model Business Corporation Act and Principles of Corporate Governance. On the other hand, it adopts Companies Act 2006 in United Kingdom. Seeing that American and England are the countries of case law, the thesis refers to certain classical cases. Finally, there are some possible suggestions to Taiwan’s law. From Bo-da case and Li-ba case, it is easily to discover that the related party transactions in affiliated enterprises make a great effect to capital market. Besides, affiliated enterprises have special characteristics so that they need the rules that are distinct from general companies. Nevertheless, there are few regulations in Taiwan. In order to solve this situation, the thesis also introduces American and English mechanisms. Generally speaking, we shall reduce certain limitations in making decisions in affiliated enterprises and admit the validity of transactions. On the other hand, although “Pass-Through Voting Power of shareholders” and “Double Derivative Suit” can not be adopted, “Piercing the Corporate Veil” in the case law of U.S. and U.K., the “Directors’ Reports” and “Unfair Prejudice” in Companies Act 2006 can be moderately accepted in Taiwan. In the end, the thesis not only discusses certain significant issues in Taiwan’s verdicts but also tries to provide certain methods to determine the responsibilities of related persons. Related party transaction is a common transaction type in companies, but there is no entire regulation in Taiwan. Sincerely hope this thesis can help our law to specify the definition of related party transactions and strengthen decision-making mechanism and supervising mechanism. In addition, with the development of verdicts, our judiciary can establish the concept of duty of loyalty and adopt “Business Judgment Rule” and “Fairness Test” to judge the responsibilities of related persons. In the end, making the best balance between synergy and effective monitor is also the goal of this thesis.