Legal Research On Protection Of Minority Shareholders' Interests During Material Assets Reorganization Of Listed Companies

In the stock market, a company has to face the need of re-optimization of the existing assets sooner or later after the initial public offerings (IPO), and material assets reorganization, which can be regarded as the key focus of the capital market, is a booster for a listed company becoming stronger and bigger, a necessary process in the development of an enterprise, and an effective way to realize industrial upgrading and technological innovation.April 16, 2008, the China Securities Regulatory Commission issued the Administrative Measures for the Material Assets Reorganization of Listed Companies, which established a systematic provision for the material assets reorganization of listed companies in the form of departmental rules and regulations. It should be noted that, in circulation times, the regulators are making many positive efforts to deal with the new situation, new problems and new challenges, including those in the various fields of major asset restructuring in listed companies. These efforts aim to protect the interests of all the investors including minority shareholders. However, in practice, there are a lot of illegal phenomena still exist widely in the material assets reorganization of listed companies, while the minority shareholders have paid the price for those offenders who have achieved the extra interests. In view of this, based on the study of many outstanding scholars, through the empirical analysis of case study, starting from the material assets reorganization system and the interests protection theory of minority shareholders, this paper, from the legal point of view, is to study the phenomena, to analyze causes of the interest damage of minority shareholders existing in the reorganization of our listed companies and to try to find out ways to strengthen the legal protection of minority shareholders'interests.The first chapter of this paper will include a brief introduction of the system of material assets reorganization of the listed companies and definition of some relevant concepts; and a development history of system of material assets reorganization of the Chinese listed companies. In this part, theoretical analysis on interests protection of the minority shareholders of listed companies is conducted, and this part will also include the significance of interests protection of the minority shareholders.The second chapter is to describe, on the basis of several cases, some phenomena of encroachment on the interests of minority shareholders in material assets reorganization of listed companies, such as insider trading, related party transactions which are not equivalent and false restructuring. This chapter will also analyze causes of these phenomena, from the perspectives of the feature of China's stock market, corporate governance and the activity of intermediaries. In the third chapter, based on the previous discussions and analysis, there will be some suggestions on improving the protection of minority shareholders'? interests, for example, improving corporate governance and the system of information disclosure, strengthening the independence of the intermediaries, transformation of government functions and reducing administrative intervention.