Research On The Legal Regulation Of The Listed Company Anti-takeover

Since 2006, the achievement of shareholder structure reform has solved the historical problem, all share circulation. In addition, a series of changes about policy, legal, economic and other external factors also contribute to the improvement to the acquisition of listed companies. The substantial emergence of acquisition encounters more and more anti-takeover of target company. As the practice of anti-takeover increasing, the lack and lag in our related legislation is gradually exposed. In view of this, this paper concentrates on the anti-takeover of listed company in our legal system and its perfection.In addition to the introduction, this paper is divided into four parts.The first part in this paper introduces the general theory of the acquisition and anti-takeover of the listed company. First, the common understanding about the acquisition and the hostile takeover of the listed company and their roles are mentioned. The acquisition is the logical starting point of anti-takeover and an action of acquiring the controlling right or management right over the target company in the public stock market. Its essence is the share transfer between the purchaser and the original shareholders of the target company and a civil legal action. With the general characteristics of the civil legal action, the acquisition also has its particularity, to comply with the binding norm in the laws and regulations. The hostile takeover is an acquisition which has not been agreed with the management of the target company. It's a direct transaction between the purchaser and the share holders. The hostile takeover is compared to any other more effective in supervising the management of the target company to perform their duties, optimizing the allocation of social resources, moderate concentration of enterprises in order to obtain the advantage of scale, achieving the survival of the fittest in related industries and so on. At the same time, it also has some negative effects , such as the benefits of the target company, other shareholders, creditor and staff harmed by the partial shareholders, the waste of social resources, industrial monopoly. Secondly, the anti-takeover of listed company is analyzed in theory. Anti-takeover is taken by the target company for defending and counterattacking against the acquisition. It also aims at the stocks, voting securities, which are distributed outside by the target company. Its core is to prevent purchaser from obtaining the controlling right over the target company in order to maintain the position of the existing share holders and the pattern of benefits. In the course of anti-takeover, a variety of strategies are available for the target company. These strategies can be divided into two parts in general. The one is the preventive anti-takeover strategy and the other is the defensive anti-takeover strategy. Moreover, numerous benefits are involved in the anti-takeover. The values on the benefits of target company, controlling shareholders, minority shareholders, creditors, staff and the purchaser are different, staggered and even conflicted. Finally, the consideration about the anti-takeover of the listed company is proposed. For a greater positive role of the hostile takeover, more effective implement of anti-takeover strategy, the balance among the benefits in the anti-takeover, the introduction of the system about anti-takeover right and the regulation on specific anti-takeover strategy is necessary.The second part in this paper discusses the legislative model about the anti-takeover in the developed countries. First, the ownership of the anti-takeover right and the regulation on specific anti-takeover strategy in the legislation systems of Britain, the United States and Germany are mentioned. The anti-takeover right is given to the general meeting of shareholders in Britain legislation, the board in the United States legislation, the board of supervisors in Germany legislation. Secondly, from the comparison of the above legislation we can get some regular enlightenment about the perfection of our anti-takeover system. It is the express provision that the target company has the anti-takeover right; the management's duties in the cause of anti-takeover must be limited; the shareholders'benefits must be protected.The third part in this paper discusses China's anti-takeovers in practice and current legislation. First, from summarizing the China's typical anti-takeover events, we can obtain our features. The anti-takeover always leads to controversies; the most controversies are on the legitimacy about the anti-takeover in the article of association; the target company's capacity of anti-takeover is scarce; the anti-takeover strategy taken is very single. The rate of anti-takeover success is not high; internal controlling is seriously in the cause of anti-takeover. Secondly, from summarizing the China's current legislation, we can obtain our features and shortages. The level of legal validity what plays a role of the anti-takeover is very low. The legislator's attitude toward the ownership of anti-takeover right is uncertain; the implement regulation on anti-takeover strategy is not specific enough; the management's fiduciary duty and related civil compensation system and the judicial remedy system are defective. The fourth part in this paper discusses the countermeasure suggestions about perfection of our anti-takeover system. First, based on our practice and current legislation of the anti-takeover, the legislative mode of Britain tally with China The general meeting of shareholders of target company possesses the anti-takeover right and the management's right in the cause of the anti-takeover is limited strictly. Secondly, under the guidance of the principle of protecting the benefits of the minority shareholders, strengthening the fiduciary duty of the controlling shareholders and protecting the benefits of the staff, the legislation clearly stipulates that the target company possesses the anti-takeover right and gives it to the general meeting of shareholders to provide legal basis of the perfection about the anti-takeover system; the legislation clearly stipulates that the proposal right part decision right of the anti-takeover strategies and executive right belongs to the management, complete the management's duty of loyalty and diligence and introduce the business judgment rule to be the exemptions for the management; the legislation clearly stipulates that the specific regulation over the anti-takeover strategies, such as the decision maker, the decision procedure, the executive subject, the executive procedure and the legal liability to give the target company deterministic behavior guidance and to reduce the controversies among stakeholders; to perfect the regulation over the anti-takeover of the listed company, the improvement of related civil compensation liability and the enhancement of maneuverability about the judicial remedy are necessary.