How To Solve The Problems Of Fund Occupation And Illegal Guarantee In The 39Th Supervision

Affected by the changes of market financing environment and the tightening of liquidity, in recent years, the capital turnover of some major shareholders of some listed companies relying on credit expansion in the early stage has encountered difficulties, and fund occupation and illegal guarantee behaviors have revived. The 21st century economic reporter is concerned that since 2018, the number and amount of fund occupation and illegal guarantee have increased significantly. Many listed companies have suffered from this and suffered serious losses or been given risk warning, which greatly hindered the normal operation of the company.

At the beginning of October, the State Council issued the opinions on further improving the quality of listed companies (hereinafter referred to as the opinions), which issued special instructions on the disposal of occupation guarantee, and seriously dealt with the problems of fund occupation and illegal guarantee. The controlling shareholders, actual controllers and related parties shall not encroach on the interests of the listed company in any way. We should adhere to the supervision and classified disposal according to law. We should pay off or resolve the problems of fund occupation and illegal guarantee within a time limit; we should strictly investigate and deal with the problems of fund occupation and illegal guarantee that have not been rectified within the time limit or newly occurred, and those who constitute crimes shall be investigated for criminal responsibility according to law. "

In the view of the industry, this paragraph is rich in meaning and will be the main regulatory thinking for the disposal of occupation guarantee in the future.

Make clear the responsibility according to the classification, and promote the rectification with leniency and strictness

Based on the present situation, facing the occupation guarantee problem, we should not only urge the relevant parties to take specific measures to clear the debts and release the guarantee as soon as possible, but also take into account the practical difficulties faced by the company and major shareholders. It is not easy to solve the problem. In order to break this situation, the opinions, based on the principle of "supervision according to law and disposal by classification", implements classified measures to solve the problem of occupation guarantee, which is a practical approach to improve the enthusiasm of major shareholders in rectification and promote the resolution of company risks.

On November 10, the China Securities Regulatory Commission held a mobilization and deployment meeting to implement the opinions, further clarify the principle of "classified disposal", give time to listed companies, and urge them to make real rectification. That is to say, on the one hand, the listed companies should be given a certain period of time to urge the responsible party to rectify within a certain period of time; on the other hand, those who have not completed the rectification within the time limit or have new occupation guarantee will be severely investigated and dealt with in accordance with the law, and those who have committed a crime shall be investigated and punished according to law. In addition, the CSRC will clearly distinguish the responsibility for problems, highlight the "key minority" of large shareholders, directors and supervisors, and implement precise supervision.

The red line of supervision can not be touched, precise supervision and strict crackdown

As early as 2005, the China Securities Regulatory Commission (CSRC) took the issue of "clearing debts and releasing guarantees" as an important part of special governance, and gradually promoted the criminal law amendment to add "crime of breach of trust and damaging the interests of listed companies", etc., and the act of occupying guarantee has been listed as a key regulatory matter to be severely punished.

The reporter noted that in the "implementation standards for disciplinary actions of listed companies (for Trial Implementation)" released by the Shenzhen Stock Exchange in June this year, it focuses on regulating typical violations such as fund occupation and illegal guarantee, and clearly defines the implementation standard of "publicly determining that it is not suitable to hold the post of director and supervisor of listed companies", and strengthens the punishment for "key minority" such as controlling shareholders and actual controllers who instruct violations To strengthen precise supervision. Since 2019, the Shenzhen Stock Exchange has made more than 70 disciplinary decisions on fund occupation and illegal guarantee matters. Among them, more than 60% of listed companies have been publicly denounced for violations, more than 460 responsible persons have been punished, and 15 people have been publicly identified. For repeated occupation, malicious concealment and other bad behavior, the Shenzhen stock exchange is to focus on cracking down.

In April this year, a Xinjiang Listed Company self-examination found that the controlling shareholder related parties occupied the funds of the listed company, accounting for nearly half of the company's latest audited net assets. As early as September 2018, the company's actual controllers, controlling shareholders and their related parties were publicly condemned by the Shenzhen stock exchange for capital occupation. In less than half a year, the relevant person in charge did not seriously rectify the situation. As a result, the company's fund of 60 million yuan was forcibly transferred by the judiciary, which constituted the actual occupation. After several efforts, the company finally recovered the relevant funds in March 2020, but within one month, another 531 million yuan of fund occupation broke out. The Shenzhen Stock Exchange publicly denounced the company for the second time, and publicly identified the actual controller and chairman of the company as inappropriate candidates.

Positive as a real rectification, fluke psychology is not good

It is worth mentioning that when the reporter combs the punishment cases of Shenzhen Stock Exchange, if the controlling shareholders, actual controllers and other capital occupiers or guarantee Instructing Parties of listed companies actively develop solutions, directors, supervisors and senior executives actively promote the timely payment of occupied funds, the early termination of illegal guarantees, and the initiative to eliminate or reduce the harm caused by violations to the company All of them should be considered as appropriate.

In the recent period, the company's net assets were not disclosed in the name of 20 million yuan, which accounted for 32% of the total assets of the listed company. After the company's internal audit department found problems through self-examination, the company and relevant responsible persons actively coordinated and released the guarantee within 3 months, causing no serious loss to the company. Although the violation of the case touched the relevant provisions of the exchange's public condemnation, the three executives were only given a notice of criticism by the exchange due to the timely rectification of the company and relevant parties.

But at the same time, the reporter also found that not all the rectification actions of occupation guarantee have been punished by the exchange. For example, a listed company in Shandong Province announced its self inspection at the end of 2019, and found that the controlling shareholder occupied the company's funds for non operating purposes, and disclosed the solution that the controlling shareholder compensated 560 million of funds with the equity of 2.3 billion yuan. Although it seems that the listed company has picked up a big bargain, there are many hidden doors behind it. The first is that the procedure is "cut first and then act", and the assets are delivered directly without the deliberation of the general meeting of shareholders; the second is that the name of the debt repayment object is not in line with the reality, and the ownership of core assets is controversial; the third is that the valuation is seriously inflated. Under two successive inquiries by the Shenzhen Stock Exchange, the company disclosed that the net equity asset valuation of the compensation object after correction is only 11.49 million yuan. Such attempts to "muddle through" by taking advantage of the deadline for rectification naturally failed to escape the eye of the exchange. Finally, the company and related parties were publicly condemned by the exchange.

In the process of debt settlement, the solution should be "reliable", the responsible parties should be "sincere", seeking truth from facts, and actively take the real rectification, which is an important consideration for the relevant parties to obtain exemption from liability. Those who take chances and try to fish in troubled waters by taking the opportunity of rectification often attract heavy blows from supervision.

Corporate governance is fundamental, and the risk is treated according to the case

From the promulgation of the opinions to the specific work deployment of the regulatory authorities, we can see the attitude and determination of the regulatory authorities to solve the problem of occupation guarantee. Only the right medicine can cure the disease. In addition to external environmental factors, the imperfect corporate governance mechanism, the major defects in internal control, and the lack of legal compliance awareness of "key minority" are the fundamental reasons that encourage large shareholders to empty listed companies. Therefore, in order to solve the problem of occupation guarantee from the root, on the one hand, it is necessary to actively rectify the violations, and on the other hand, it is necessary for listed companies to improve their own governance level, so as to achieve both "temporary cure" and "permanent cure".

According to the opinions, it is necessary to "standardize corporate governance and internal control", strictly implement the internal control system, and enhance the effectiveness of internal control. The controlling shareholders and actual controllers should perform the duty of good faith and earnestly protect the legitimate rights and interests of listed companies and investors. The general meeting of shareholders, the board of directors, the board of supervisors and the management should operate in accordance with the law, and the directors, supervisors and senior managers should perform their duties faithfully and diligently. At the mobilization and deployment meeting for the implementation of the opinions, the CSRC also clearly pointed out that it would adhere to the "two wheel drive" of information disclosure supervision and corporate governance supervision, comprehensively launch the special action of listed company governance, urge the company to conduct self-examination and rectification, improve the system of corporate governance rules, strengthen the bottom line requirements of corporate governance, and improve the long-term mechanism of corporate governance.

The integrity standard is the cornerstone and internal requirement of the high-quality development of listed companies. The listed companies' governance can be "well prepared" and "key minority" can really achieve "four awe". Only by occupying guarantee can they become "red line" and "bottom line" and not be overstepped.

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