Research On Legal Problems In Affiliated Transactions

Affiliated transaction, as an economic phenomenon, comes up with the development of the corporation system. It also has relations with the interest subjects, who relate to corporation, such as stockholders, directors, managers, supervisors, and other correlative subjects. Affiliated transaction is conducive to saving transaction expenses and raising transaction productivity. So it has been widely used in today's corporations. It can help corporations with management in a larger scale. But, on the other side, because of the connected subjects of affiliated transaction, the affiliated transaction also objectively brings risks such as unfairness. In recent years, with the further reform of enterprises and the increasingly fierce market competition, purchasing, alliance, and mutually holding stock between corporations become more and more frequent. In order to raise their capability in market competition, large enterprises have set up affiliated corporations in succession. So, more and more affiliated transactions emerge with a constantly growing amount. But on the contrary, the violations of listed companies in affiliated transactions are constantly increased. So, in order to keep the stability of stock market and protect the mall stockholders of listed companies, how to strengthen the regulation of affiliated transactions in listed companies has been an urgent task for China's stock market. These article aims at how to regulate affiliated transactions in listed companies both from Company Law and from Securities Law. The author puts forward some opinions and advice about how to stipulate affiliated transaction in China at present.According to the Company law, this article is mainly about how to regulate affiliated transaction on administrative mechanism of corporation. In director's self-dealing, this article focuses on the scope of involved parties, procedure of examination, subject of claims, and director's compensation. This article points out some limitations in our law that is currently in effect. At the same time, this article brings out some feasible suggestions for these limitations. In controlling stockholder's affiliated transaction, it is advised to restrict controlling stockholders' power and reinforce their responsibilities. On the side of Securities Law, according to the actuality of affiliated transaction in our stock market, this article points out the limitations of our legal regulation of affiliated transaction in listed companies, such as information disclosure, connected credit assurance, and legal responsibility. The author gives some constructive proposals, which will help not only to improve the openness of affiliated transaction in stock market, but to reduce the contingent risk of affiliated transaction also.