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Sponsor Representative, Securities Regulation And Improvement Of Sponsorship Quality

Posted on:2013-01-27Degree:DoctorType:Dissertation
Country:ChinaCandidate:W X NingFull Text:PDF
GTID:1119330374480610Subject:Finance
Abstract/Summary:PDF Full Text Request
It has been eight years since Sponsor representatives system under Authorized System turned into Stock issue system of A share market in2004. The implementation of Sponsor system has vital function for Security Company to develop stock sponsor and underwriting services, as well as cultivate stock issuing professionals. Besides, Sponsor system is also the result of further transition of stock issue from administrative examination and approval to marketization, and it promotes healthy development of A share market.However, since the implementation of Sponsor system, repeated problems have arised in Listed Companies after IPO caused by unfavorable performance of sponsor system, namely unsecured sponsor quality. Moreover, internal contradictions of sponsor work become obvious gradually. Contradictions and conflicts among behavior subjects in the system restrict the development of sponsor work and give rise to continuous low efficiency of IPO. Newly elected CSRC has expected to solve problems existing in A share market by institutional reform since October,2011. Investors have called for IPO system reform, and CSRC brought stock issue system into reform range. Chairman of CSRC Mr. Guo Shuqing posed the question in internal meeting in late2011to officials of CSRC issue department and committee members of the service hall:is it acceptable for not having examination for IPO? A new round of stock issue system reform is to start. Sponsor representatives system and authorized system implemented by regulator to IPO will become the high-profile reform targetsThis article attempts to find the reforming way for sponsor system and IPO link examining mode. Firstly, starting from historical evolution of the system, the stock issue system of A share market in china is reviewed. After analyzing the origin of stock issue system and historical background, as well as design concept of sponsor system implementation, the sponsor system is studies from two angles:one is observing the influence of exploring external system on sponsor system from the point of entire A share market. The other is interpreting the interaction of all behavior subjects in the situation of different profit appeals by analyzing behavior strategy of every behavior subject in sponsor system. The internal and external causes of problems in implementing sponsor system become explicit by analyses from the above two angles. It's found that the problems of sponsor system are not only caused by design deficiency of the system, but also by imperfect of external system in A share market. Historically, the dominating position of administrative supervision domains all in A share market in china causes the situation that market mechanism and judicial system play little role at the stage of both pre-supervision and post-supervision. Single administrative supervision strategy cannot protect fully A share market; Moreover, its market intervention blocks the healthy development of A share market. Excessive administrative supervision caused the problems, such as scarcity of listed companies, indeterminacy of sponsor responsibility, interference of pre-supervision to marketization choice, lack of punishment and regulations caused by lack of post-supervision. Therefore, even after sponsor system under authorized system becomes IPO system, problems still exist and require solutions.Then, other countries and districts'store market of using sponsor system are introduced with analysis of motives and system design features of implementing sponsor system. Three countries with distinctive features are selected, namely, Britain, America, and Hong Kong. Britain is the first country implementing sponsor system. Hong Kong is the template for Chinese sponsor system. Stock issue supervision system in NASDAQ market in America is not sponsor system to be exact, but it has features of sponsor system and reference value. Compared to traditional sponsor system, this system makes detailed division of labor with distinct rights and liabilities and scattered risks. Apart from studies on the above three countries, cases in Canada, Korea and Singapore are analyzed with emphasis on particular feature in sponsor system. It explores the reference value of experience of above six countries to Chinese sponsor system by comparing different features with Chinese situation. The outcomes clarify the relationship between sponsor representatives system and its market environment and elaborate reform direction of external market environment of sponsor system.Game analysis is used as theoretical basis of above discussion. The first model analyzes regulators'control mechanism on sponsor representatives during their selection of listed companies, and also modelizes business requests of regulators for sponsor representatives. Both pre-supervision and post-supervision are brought into Game Model. Under the condition of regulators'reasonable implementation of the system, optimal supervision strategies are designed to regularize sponsor representatives'behaviors. There are two aims for designing this model:one is to inspect the obligation of sponsor representatives—how can the system be designed for sponsor representatives to meet commitment. The other is to further study practicability and drawbacks of supervision strategies, and discuss the feasibility of de-administration of supervision issue system. The model reaches the conclusion that lack of punishment on people in charge of IPO project with problems causes ineffectiveness of sponsor, and proves that as long as regulators reasonably distributes efficient punitive action at post-supervision stage, pre-supervision can be replaced and intervention of administrative supervision on sponsor work can be reduced. Based on the above model, in the second model, sponsor representatives'qualification is added to analyze their influence on regulators and implementation efficiency of IPO. Variables in the model provide evaluation criterion in sponsor representatives'qualification for future establishment of comprehensive information disclosure platformThe third model is used to clarify the Game action relationship among behavior subjects at IPO stage. Based on this model, the action mechanism of regulators on sponsor system is systematically elaborated. By analyzing different issuers'choices of sponsor representatives with different qualifications, selection mechanism can be found to improve sponsor quality. This model solves the following two problems:One is that how regulators can solve the conspiring problem between IPO issuers and sponsor representatives under the optimal supervision strength. The other is that while qualified sponsor representatives can be guaranteed to exert high-level sponsor capability, less qualified sponsor representatives can also be provided with opportunity to increase their qualification, which can improve overall capacity of sponsor representatives market. With this model, we can also conclude that authorized system cannot be cancelled at this stage for two reasons:one is that a assessment system for sponsor representatives has not be established and it is difficult to distinguish sponsor representatives'qualification. Sponsor behavior of sponsor representatives with lower ability need to be made up by authorized system. Another reason is that post-supervision system also hasn't substituted pre-supervision. Low-rate punitive action and incoherence of punishment lead to the result that supervision behavior can not have efficient deterrence on illegal problems.The main theoretical contributions of this article are as following:(1) Studies on sponsor system in academic field are increased, particularly theoretical research on sponsor representatives system. The present situation which leads to failure in guaranteeing sponsor quality is analyzed, namely intervention of pre-supervision, no establishment of multilevel system in post-supervision, imperfect of plate design in A share market and external supplementary system, lack punishment on people responsible for IPO project with problems. This article proposes some suggestion on Chinese sponsor representatives system under authorized system, based on the above problems, development of Chinese securities issue supervision system and advanced experience of other countries'sponsor system. It attempts to help turn the reform direction to high efficiency stock issue system in the consideration of Chinese situation.(2) Operating mechanisms of diverse issue systems at different Chinese historic stages are recognized during issue system procedure. At review of different stages, changes of related rights and obligation of main subjects are analyzed, which is followed by analyses of supervision policy development of CSRC, right and obligation of sponsor representatives in sponsor system, and the relationship between sponsor representatives and Sponsor Company. Then, sponsor representatives is viewed as independent participation in IPO and brought into power struggle of related subjects, which provides a better analysis framework at the stage of IPO implementation. The finding is that low operating efficiency of sponsor system is not only caused by inherent loopholes of system design, but also failure of complementary cooperation between government's administrative supervision and sponsor system to guarantee sponsor quality. By analyzing supervision strategies in government's administrative supervision, causes of present phenomenon in regulators like "take pre-supervision seriously and neglect post-supervision" is explained. The proposed view is that establishment of multilevel post-supervision system in replacement of pre-supervision, which is dominated by administrative supervision and can play a role in both market mechanism and judicial mechanism, can terminate the intervention of pre-supervision for IPO implementation and in the mean time, ensure sponsor quality of IPO project.(3) Constructing Game Model to analyze main part of sponsor system reflects creativity of this article. Though some literatures referred to this aspect, their issue lacks entirety and real interaction among main subjects. The theoretical models in this article not only analyze the sponsor representatives as main subject with description of their behaviors of choosing optimal listed companies in IPO stage, but also analyze the role of regulators by bringing regulators as the controller of sponsor quality and system implementing efficiency. By solving sponsor requirements of Nash Equilibrium condition and taking the outcome as a basis of regulators controlling sponsor representatives, the effect of regulators is inset this model. Moreover, the model includes the latest supervision project of CSRC up to June,2011. The model predicts trial effect of this project in theory, and assumes that if there is no improvement on specific supervision action and penalties of CSRC, the new supervision project will not enhance the sponsor quality of sponsor representatives.
Keywords/Search Tags:sponsorship quality, securities regulatory system, sponsor representative, sponsor system
PDF Full Text Request
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