Abstract:
Corporate mergers and acquisitions (M&A) play a vital role in improving corporate governance and optimizing resource allocation. However, controlling shareholders may exploit related-party M&A, de facto mergers, squeeze-out mergers, and similar transactions to pursue private benefits at the expense of minority shareholders and corporate interests. China's current legal framework exhibits insufficient institutional supply in regulating such conduct. At the behavioral regulation level, rules governing special M&A types such as de facto mergers and squeeze-out mergers require refinement, and the scope of shareholders' appraisal rights remains limited. At the procedural control level, voting recusal rules lack comprehensiveness, and information disclosure mechanisms overemphasize formality. At the judicial governance level, fairness reviews of related-party transactions have not fully clarified the relationship between procedural and substantive fairness, and judicial standards for determining share repurchase prices remain overly singular. Inadequate coordination among these institutional mechanisms obscures the boundaries of control rights exercise and, to some extent, constrains the full realization of corporate autonomy and judicial governance functions. The underlying causes primarily stem from existing rules' insufficient responsiveness to the distinctive nature of interest conflicts between controlling shareholders and companies in M&A contexts, and the need for further specification of the principle prohibiting abuse of rights in application. Accordingly, this study recommends constructing a more comprehensive regulatory system based on the conflict-of-interest attributes of controlling shareholders' self-interested M&A by clarifying controlling shareholder duties, optimizing corporate autonomy rules, and remedying judicial adjudication deficiencies. Such systematic regulation would effectively fulfill institutional functional expectations and enhance the resource integration benefits of corporate M&A.
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