Wu Guoping's Discussion On The Absence Of Class Action System

At the recently held "two sessions" press conference, Yin Zhongqing, vice chairman of the finance and Economic Commission of the National People's Congress, talked about the revision of the securities law. Yin Zhongqing said that the revision of the securities law is a comprehensive revision compared with the previous four amendments. According to the legislative work plan this year, the Standing Committee of the NPC will arrange for the revision of the draft Securities Law in late April. If the progress is smooth, after the second instance and the three trial, it can be introduced in this year. This also means that it is closely related. IPO Registration system may also be implemented within the year.

Of course, what aspects of the securities law have been revised, such as the eradication of the low cost of irregularities, how to deepen the protection of investors and so on, is obviously the most concern of the market. According to the introduction, the revision of the securities law mainly solves five problems: first, we need to push forward the reform of the registration system of stock issuance. The two is to improve the multi-level capital market. The three is to improve the investor protection system. Four is to promote the innovation and development of the securities industry. The five is to strengthen supervision afterwards.

In terms of investor protection, although the revised draft has set up a special chapter on investor protection, it has strengthened the protection of investors, especially the small and medium-sized investors and retail investors. Litigation system It is still missing. It only consummate shareholder derivative litigation system and representative litigation system. This not only makes the market somewhat disappointed, but, even though it has been perfected, it still has defects in protecting investors, such as shareholder derivative litigation system and representative litigation system.

Shareholder derivative litigation refers to a lawsuit system that suits the legal conditions of shareholders when the company's legitimate rights and interests are infringed upon by others. But in practice, even large shareholders or actual controllers have hurt the interests of listed companies, and few shareholders have taken legal arms to safeguard their rights. Although the representative litigation system has been implemented in China's judicial practice, it has not played a significant role in investor rights protection. Even if investors are able to protect their rights, they are usually prosecuted by lawyers, and whether they can succeed is another matter.

In addition to the compensation made by Wanfu Sheng branch from the sponsor to investors, Hai Lian news is funded by its four major shareholders to compensate investors. In the case of many investors who have successfully protected their rights by means of legal means, the majority of the listed companies are false statements. This is also closely related to the regulations of the Supreme People's Court on the trial of civil compensation cases caused by false statements in the securities market. In fact, on the market Investor The case of rights protection is only here. Others, such as manipulating stock prices, insider trading and so on, even suffer from the loss of investors' interests, are often faced with the embarrassment of wanting to complain. Conversely, if the stock price is manipulated or the insider trading is seized, the Treasury can generate income, which is unfair to investors.

Obviously, only the judicial interpretation of false statements is far from satisfying the investors' rights protection requirements, nor can they meet the needs of the unconventional development of the market. Moreover, even if the regulatory authorities often shout "to protect the legitimate rights and interests of investors, especially the small and medium investors", if there is no guarantee for system building and no one dimensional right of class action system, even if the securities law is amended to set up an investor protection special chapter, it is still difficult to fundamentally solve the problem of safeguarding rights.

In fact, the market has great expectations for the revision of the securities law. After all, since the last revision, time has passed nearly ten years, and China's capital market has undergone tremendous changes. The existing securities law has long been out of date, and there is an urgent need for a "new" securities law to escort China's capital market. However, if this time the Securities Law is amended, if there is a lack of class action system, it will undoubtedly be a great failure.

With regard to the revision of the securities law, we should not only appeal to the group action system again, but also hope that the cost of violation can be greatly increased in the draft. In the current A share market, frequent violations have become a big "landscape". Moreover, because of the low cost of violation, it leads to more irregularities, which further undermines the interests of investors. In particular, it is a serious joke in the global capital market that the existing securities law can not be severely punished, such as the serious fraud of the nature of the green land, such as the serious violation of Nanfang shares' financial fraud for five consecutive years.