Comparative Study On Securities Information Disclosure Standard

The information disclosure system is one of the most important and effective means for the government to regulate the securities market in different securities law systems of various countries and regions in the world. The information disclosure system can be set up as the foundation of the stock market and the core of the securities law system as well as a strong guarantee for the exercise of the right to know for the securities investors, to protect the legitimate rights and interests of investors. As China's securities market has gradually got onto the legal system of standardized development, legislators and securities regulators increasingly recognize the essentiality to safeguard the confidence and benefits of investors as well as the open, fair and just order of the securities market. Information disclosure standard is one of the most important manifestations of valuable concept in the information disclosure system, in particular, the "materiality" standard is the basic standard which exists in all aspects of the disclosure of information. To ensure the public confidence in the issue and trading markets, the first and foremost means is to guarantee access to major information relating to the issuer,timely, fairly and accurately for all investors, especially the medium and small investors who are in disadvantaged position. It is clear that we must well establish the "materiality" standard, there is no national and regional requirements for the issuer to disclose all information. The information that must be disclosed only include the information which has a significant impact on the investment decision-making of the investors or the market price of the securities. Thereupon, "materiality" standard becomes the main and difficult point to define insider information and to determine what kind of standards for what kind of information is "materiality", that is, "materiality" is a basic concept in the information disclosure regime and also is a key issue in insider trading liability. Only information with "materiality" has the issuer an obligation to disclose publicly and only information to be used or disclosed with "materiality" do the issuer bears legal responsibility of insider trading. With the basic purpose of information disclosure to adapt, to define "materiality" standard has to find the balance between two aspects: investors want to obtain all useful information for investment decision-making so as to be beneficial to make a rational investment decision-making; the issuer can reasonably decide what is important information in order to make it clear the scope of the disclosure of information.This study starts from the point of view of information disclosure, first of all, it discusses the basic concepts of information and securities information, and then focuses on insider information related to information disclosure standard. Specifically, it is necessary to introduce several different types of information and the basic characteristics of the definition; then this paper has a overview of the information in the meaning of the Securities Law, including its meaning, classification, as well as the controversy between different standards for some information becoming the information on the Securities Law. This controversy stems from different determination criteria: one category is "important information", only the essential information is real information consistent with the meaning of the Securities Law, such as the United States, Japan and other countries; the other is "price sensitive information", such as the European Union, Hong Kong Special Administrative Region of China. The former emphasizes subjective judgments while the latter emphasizes the relative objectivity of the information. On insider information, there are some basic information theory problems, the provisions about insider information in different countries or regions and the theory and practice of our country. Afterwards, this paper makes a brief overview of the information disclosure system, including historical research, characteristics, significance and theoretical basis(law and economics foundation); thereout it begins the comparison study on the issue of information disclosure standard. On this basis, this paper has a detailed introduction to the basic problems regarding information disclosure standard and the universal standard of information disclosure in order to well prepare for the coming comparative study.Next is the focus of this article, that is, it compares the two main lines of information disclosure standard: one is a vertical comparison, taking the law of the United States as an example to inspect the most developed securities market information disclosure standard in the United States on the history problem , doctrine, jurisprudence and the relevant theoretical issues; the other, a horizontal comparison, that is, this paper looks on "materiality" as the most important point of information disclosure standard throughout the whole comparison, and distinguishes the legislative and judicial practice on information disclosure standard in the stock markets of the major developed countries and regions.Therefore, the whole comparison makes us have a more comprehensive understanding about the issue. In this process, the most important is to define "materiality" and analyse the relevant doctrine, jurisprudence and various provisions about this problem in different countries and regions. Separately this paper discusses "materiality" from both theory and practice: a brief introduction to the origin of "materiality" standard, including the concept and the significance; focuses on the doctrines and cases of "materiality" standard in the law of the United States; makes a comparative study about the provisions and doctrine orientation of "materiality" standard and compares some concepts related to "materiality" : significant fact, major changes and significant information.Finally, this paper recalls the development of China's securities market, lists and compares inconsistent views (mainly the relevant provisions of the legislation) about information disclosure standard, then introduces the debate on the issue of China's scholars. In conclusion, this paper deems that we now should implement two-track parallel system: "securities price standard" and "investment decision-making standard".