On The Heteronomous Registered Stock Issue System Of Second-tier Board In China

Since 1998 a vast of paper has been discussing the second-tier board market in China. The government decided to establish the small and medium size business board in Shenzhen Stock Exchange in 2004. As the rudiment of the Chinese second-tier board, the board shows that it is necessity to establish the second-tier board market in China. So it is urgent and important to study the system and operation details of the board. First, the paper points out that the second-tier market should establish heteronomous registered system. The study compares the registered systems in the UK and USA in which two types of registered systems---heteronomous and autonomic are carried out respectively. The results show the different between the heteronomous and autonomic registered system is the power of the stock exchange and government monitoring institution. The success of heteronomous registered system and the change of autonomic monitor system show that basing on the full-disclosure information, restricting the power of the stock exchange by the government and the law will be helpful to the development of the market. Registered system is the result of marketing. After ten years, internationalization and marketing are the certain choice of Chinese stock market, while monitor system is also required. Thus, the system of approval to equity issue in China should be heteronomous registered equity issue system, neither approval system nor the autonomic registered system. Carrying out the heteronomous registered equity issue system and establishing mechanism of marketers'self-restriction and self-responsibility under centralized legal system are very important. Acting with the sponsor system, compelling information disclosure system, pure market-maker system and delisting system the heteronomous registered system will operate effectively and totally. For these reasons, the paper also studies the sponsor system, compelling information disclosure system, pure market-maker system and delisting system. Second, the paper studies on the orientation of the market. It is much easier to issue on the abroad second-tier board. Distinctively, the study points out that the Chinese second-tier board should have a high threshold (e.g. continues surplus and fast increase in portfolio), and act on the enterprises'ability to grow and innovate to facilitate the enterprises. High threshold is accord with the abundant resource of Chinese stock issue, low monitor level, circumstances and the theory of enterprise growth, which is also the necessary result of establishing the multilayer capital market. Further, the business in the period of gestation, babyhood and teetering can finance by property right exchange and risk investment. And the mature business can finance in the main board. High threshold is the base of heteronomous registered system which can deduce the market risk. Third, the information disclosure system and postmortem monitoring are important for the heteronomous registered market. The paper thinks heteronomous registered market should strengthen the compelling and selective information disclosure, and brings forward the concept of symmetrical information from the point of information economics. Symmetrical information is fair information in nature, which is the core and aim of the information disclosure system. Because of the difference of time, understanding and judgment symmetrical information is an idealization while the asymmetry information is the normality. But symmetrical information is not unmeaningful, which is the aim of the information disclosure system and will be helpful to establishing information disclosure system, deducing cheat and market risk. Under the direction open, equity and fair market will be established soon. Forth, from the point of stock issue, information disclosure and exchange, sponsor system will strengthen the marketers'responsibility and self-restriction, which is also helpful to establish the postmortem monitoring. Because of the loose entry to the heteronomous registered system, sponsor system can guarantee the implement of the heteronomous registered system by the arrangement. Under the heteronomous registered system the monitor departments expose information and let it be instead of approve itself. Therefore, the paper thinks that from the point of IPO postmortem monitor, the second-tier board should carry out a total market makers system, and the purveyors, sponsors and market makers should be the same organization. Thus it can be responsible for the liabilities after stock issue. As the corresponding system of heteronomous registered system, the pure market makers system is the promise. Moreover, by market makers system the hidden bankers can be changed to explicit ones, which will be helpful to monitor and restrain baleful actions. On the other side, general and strict delisting system should be established to optimize the collocation of the resource by elimination in market. Last, because the study on stock issue in Chinese second-tier board market is comprehensive, the shortcoming in the paper is inevitable. More and further researchesare needed.