Comment On The Legislative Regulation Of Listed Company's Anti-takeover

Thanks to the deregulation of takeover and anti-takeover, the merger andacquisition market of China becomes more and more active in recent years. Regardingto hostile takeover, many target companies take anti-takeover measures. In thetakeover and anti-takeover campaigns, what kind of measures should be taken bylisted company's management to maintain corporate control, whether it has the rightto take these measures? Whether these measures taken by listed company'smanagement are legitimate, how to regulate these measures? Some of the problemshave aroused dispute in practice, but they have not been resolved until now. Theanti-takeover legislation of our country has not been established until now, whichleads to that the problems in anti-takeover have not legal basis for settlement. Thearticle aims to put forward proposals for the construction of the anti-takeover systemof our country through analyzing the situation of legislation and practice of ourcountry and comparing the British model and American model .This essay is dividedinto four parts:First part: the Summery of the Listed Company's Anti-takeover. In this part, wefirstly summarize the concept of the anti-takeover through analyzing the concept oftakeover. That is the measures used by the management of the listed company in orderto maintain their control rights. Then the part introduces background and the influenceof the anti-takeover: it makes for assuring the justness of takeover;it promotes toestablish the mechanism of anti-monopoly to guarantee the common goods;it ispropitious for protecting the rights of management, employees and creditors. At last,the part talks about the two main theories of takeover and anti-takeover and analyzethe limitation of them.Second part: the Necessity of Establishing the Anti-takeover System in OurCountry. At first, this part introduces the situation of legislation and practice ofanti-takeover in our country. At present, there is not consummate legislation ofanti-takeover in our country and the actions of anti-takeover are much more confused.And then this part evaluates the basic anti-takeover measures and discusses whichmeasures adapt to the actual situation of our country. The measures of poison pill,parachute and scorched earth policy do not adapt to our country, as they disobey ourpresent laws. And shock repurchase lack legal basement in our country. Managementbuy-out is restricted because of the validity of body and the resource of takeoverfinancing. While Employee Stock-ownership Plan, white knight and shark repellentsuit the actual situation of our country. Lastly, this part analyzes the necessity ofestablishing the anti-takeover system and thinks that it is urgent to establish theanti-takeover legislation of our country.Third part: the Introduction and Evaluation of the Legislative Regulation ofAnti-takeover in Foreign Countries. This part makes research into the legislativeregulation of anti-takeover actions adopted by US, Britain, Germany and Hong Kong,and makes judgments about them. Firstly, Williams Act is a very important law ofanti-takeover in US and its main content is the publicity of anti-takeover'sinformation. In US, the management of the listed company have the rights to makedecision of anti-takeover, and they judge whether the measures are legitimate by thebusiness judgment rules;Secondly, Britain City Code regulates the basic principles oftakeover in particular and awards the rights to make decision of anti-takeover toshareholders;thirdly, German Securities Acquisition and Takeover Act detailedlyregulates the measures of anti-takeover that the management of target company canuse when they face hostile takeover. Lastly, the main regulation for anti-takeover oflisted company of Hong Kong is Rules of Takeover and Acquisition. Throughcomparing the British model and American model and considering the actual situationof our country, the article analyzes the advantages and disadvantages of the twomodels and the feasibility in our country.Forth Part: the Establishment of the Legislative Regulation of Anti-takeover forOur Country. First of all, this part makes some suggestions for the construction oflegislative regulation of anti-takeover for our country: we should establish the basicprinciples: the decision rights of anti-takeover belong to shareholders;the goods andrights of little shareholders should be protected;the abuse of rights by managementshould be restricted. Next, this part puts forward the contents of establishing thesystem, including two portions. First portion sums up the appropriate measures ofanti-takeover for our country on the foundation of analyzing the present circumstanceof laws and practice. The other portion brings forwards the advice that we shouldregulate managers' obligation of loyalty and care. This portion includes: the sufficientinformation publicity of the company anti-takeover;provide suggestions forshareholders to make decisions;strive for the best conditions for shareholders;forbidthe complot of the managers of the takeover company.