Pledge of Stock Rights also known as equity pledge, refers to the pledge set up by the mortgagor with the shares owned by him as the subject matter of the pledge.According to the current legal system of security in most countries of the world，Pledge is based on its subject matter and can be divided into chattel pledge and right pledge.Equity pledge is a kind of pledge of rights. Because of the establishment of equity pledge, the creditor acquires the security interest in the pledged equity, which is equity pledge.

Judging the target of equity pledge should be judged from the fact.

　  First of all, when the equity is pledged, What are the rights of the pledge?Whether the pledge is a property right or a full right, these rights can not be transferred and occupied like physical objects, It can only be satisfied by transferring vouchers or registering.Therefore, what has been transferred can not be identified from the activities of establishing pledge, but can be examined from the implementation of pledge right.

　　Secondly, when the debt repayment period expires, but the pledgor is unable to repay the debt,  the question of the enforcement of the pledge right is involved.The Guarantee Law does not provide for the enforcement of pledge of rights, but it allows comparison with the general provisions of pledge of movable property.As for the enforcement of chattel pledge, Article 71 of the Guarantee Law stipulates that if the pledgee has not been repaid at the end of the debt performance period，It also can be agreed with the pledgor to reduce the value of the pledge, or can be auctioned according to law, the sale of the pledge.Therefore, the pledgee of the pledge of rights may also agree with the pledgor to transfer the pledged rights, or auction or sell off the pledged rights.

　　Whether the agreement transfers the pledge of the equity or the auction, the sale of the pledge of the equity will have the same result, that is, the transferee becomes the company's shareholders.Otherwise, if the transferee acquires the so-called property rights, but has neither the decision-making power nor the right to choose a manager, and these rights are enjoyed by a party who has no relationship with the company's property, isn't it ridiculous?Therefore, this also prove that the established pledge from the beginning is all rights, not just property rights. Because a right to be transferred is incomplete at the outset, but it becomes complete after transfer, which is  impossible.Some authors also pointed out that the equity as the subject matter of the pledge right must not be forcibly divided to recognize only one part as the subject matter of the pledge right and exclude another part without reason.

　　Thirdly, when the shareholders'meeting of the company decides to grant the pledged shares, it actually implies a transfer of shares that may occur at that time, including consideration of the company's human compatibility.China's Guarantee Law stipulates that the Pledged Shares of a limited liability company shall be applicable to the relevant provisions on the transfer of shares in the Company Law.The pledge contract shall take effect from the date on which the share pledge is recorded on the register of shareholders.However, the Company Law stipulates that shareholders of a limited liability company may transfer all or part of their capital contributions to each other; when the shareholders transfer their capital contribution to a person other than the shareholders, they must obtain the consent of more than half of the shareholders.

　　According to the provisions of the Company Law, the pledge of shares should also be divided into two situations. The first is that the pledgee is the other shareholders of the company, and the pledge of shares of the company does not need the consent of others at this time.Second, if the company shares are pledged to people other than the company's shareholders, the consent of more than half of all shareholders shall be required.Because if the debtor at maturity is unable to pay off the debt,the pledgee may exercise the pledge right and become a shareholder of the company.In view of the certain personnel composition of the limited liability company, the consent of more than half of all shareholders is required.The majority of the company's shareholders agree, which means that in fact the company's shares are not in conflict with the company's personnel composition.

　　Finally, from a conceptual point of view, the traditional idea is that the pledge of the company's shares only includes property rights, which is to separate the rights in isolation .In fact, in the market economy, it is impossible for the transaction subject to divide rights into many parts and consider them as jurists do.In addition, if it is true that only property rights can be transferred, then this assumption will inevitably lead to disputes in the execution of the pledge right, which will conflict with the social function of the people's legal division.Therefore, the subject matter of the share pledge of a limited liability company should include all shareholders' rights.

Foreign legal provisions

　Many countries have laws governing the establishment of security interests on equity.For example, the France's“ Commercial Company Law” and the German "Limited Liability Company Law" Article 33 deal with the provisions on the mortgage of shares.More typical is the relevant provisions of Japanese law. Article 32 of Japanundefineds Limited Company Law stipulates that "share shall be the object of pledge".Article 207 of Japanundefineds Commercial Law also provides that "where shares are the subject of a pledge, they shall be delivered to the stock visible".Japan's company law compares the equity held by shareholders of limited liability companies with the equity held by shareholders of Limited Liability Company by Shares as pledge targets and establishment of equity pledge.