1、 What are the causes of invalid company establishment

The company must be established in accordance with the law, which mainly includes the company's type, number of shareholders, registered capital, shareholder contributions, method of establishment, and establishment procedures, which must comply with the provisions of the law. The invalidity of company establishment is mainly caused by the violation of laws and regulations. The reasons for invalid establishment can be roughly summarized in the following three aspects:

1. The subject of establishment is flawed.

Namely, the promoters or shareholders lack the qualification of the main body or have defects in their declaration of intention, including whether there are persons with or without limited capacity among the promoters or shareholders ; A promoter or shareholder expresses his intention to establish a company due to fraud or coercion; The promoters or shareholders clearly know that their actions will infringe the interests of creditors and make a declaration of intention to establish.

2. The act of establishment itself has flaws.

That is, the company was established in violation of the requirements of legal conditions and legal procedures, or other mandatory provisions. It mainly includes:

① The promoters have not subscribed for all the shares that should be issued by the company, or the shares issued for the establishment of the company through public offering have not been fully subscribed beyond the deadline specified in the prospectus.

② The establishment of the company does not meet the conditions prescribed by the Company Law.

3. Other reasons.

In addition to the above two reasons, other reasons may also lead to the invalid establishment of the company. For example, the founding meeting of the company had already decided not to establish the company.

2、 What are the ways of company establishment

1. Establishment by sponsorship: also known as "simultaneous establishment", "simple establishment", etc., refers to the way in which all the shares of the company or the first issue of shares are subscribed by the promoters themselves to establish the company.

1) A limited liability company can only be established by means of sponsorship, with the capital contribution of all shareholders.

2) A joint stock company may also be established by means of sponsorship.

3) According to Chinese laws, a joint stock limited company can be established by means of promotion or by means of public offering.

4) Initiation and establishment are relatively simple in procedure

2. Establishment by public offering: also known as "gradual establishment" or "complex establishment", refers to the way in which the promoters set up a company by subscribing for only a part of the company's shares or the first issue of shares, and the rest of the shares are raised externally.

1) The establishment by public offering can either be established by issuing shares to the public, or it can be established by raising shares from specific objects without issuing shares.

2) Only joint-stock companies can be established by public offering, and limited liability companies cannot be established by public offering.

3) When the company is established by public offering, the shares subscribed by the promoters shall account for 35% of the total share capital of the company.

4) The procedure of raising and establishment is relatively complicated.

The company is an enterprise legal person, has independent property, and can assume responsibility in its own name. However, it is necessary to distinguish between branches and subsidiaries. A branch is only a branch of the head office, which needs to follow the name and business license of the head office. As for the debts of a branch, it is generally the property of the head office that is responsible for them. However, the subsidiaries are different. The subsidiaries and the parent company are two independent legal persons, which carry out their own production and operation activities and bear legal liabilities independently with their own property.

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