Proxy solicitation is the result of the division between ownership and control of the modern company by shares. Proxy solicitation, in a legal perspective, on the one hand, can play an important role in protecting the interest of medium and small shareholders, improving corporate governance, promoting democracy of corporate operation and boosting the healthy development of the capital market, on the other hand, can be manipulated to become the tool for controlling the company. As this mechanism has both sides of the coins, how to regulate it to encourage its advantages and avoid its disadvantages forms the starting point of this paper. Chinese capital market, being more and more matured, has become the part of the market economy system. The existence of multiple categories shareholding entities and the increase of transferable stock, while providing the opportunity for the emergence of proxy solicitation are the realistic basis of this research. Finding solutions for proxy solicitation in the absence of the relevant legislations is the directive motive for this paper.With the above-mentioned considerations, this paper, by using the methodologies of comparison and economic analysis, touches upon the basic theories of proxy solicitation and its current development in China, analyzes the growth of the Chinese capital market, the structure of shareholding system and the defects in the legislation of proxy solicitation in China and discusses the legal mechanism of proxy solicitation suitable for China with reference to foreign experience. This paper is divided into three parts.Part one deals with the basic theories of proxy solicitation. Beginning with the economic and legal cause for the occurrence of proxy solicitation, this section analyzes the definition of proxy solicitation in Taiwan Province and other countries, explains its meanings at different levels in mainland China and points out that proxy solicitation should be defined to limit it to the two situations where the current management or the non-management shareholders initiate the process. In addition, the proxy solicitation mechanism is also examined in the perspective of civil law, company law and securities law.
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