A Study On The Group 's Litigation In China

In recent years, many Chinese companies are listed in the United States, but they become the hot defendant of securities class action due to the problems exposed during the process. Chinese listed companies has lost many cases and suffered serious economic losses, reputation crisis and even delisted out of the reason that they have little understanding of the relevant laws and regulations of the United States. In this article, the author studies Chinese companies’ own problems and the security class action environment, analyzes the reason why Chinese companies being sued and sort out the legal basis of security class action, so as to figure out the solutions.Besides the preface and the conclusion, this article contains4chapters, and each chapter is as follows:The first chapter introduces the background of the class action which Chinese companies suffered. From the point of empirical analysis, the author lists Chinese companies own problems, mainly including information disclosure, reverse merger, corporate governance and internal control issues, and also mentions the security class action environment in the United States. This chapter is the know-how part of this article.The second chapter introduces the issue of Chinese companies suffered a class action in the United States and look for the causes by the comparative method. The most important reason is that there is a big difference between US and China’s securities markets and litigation. In another way, Chinese companies have the problems of information disclosure, reverse acquisition and Company’s internal control.The third chapter introduces the legal basis of the U.S. securities class actions and relevant factors finding the strict information disclosure rules and the rules of class action procedure in the United States is a unique system. The main provisions are under the Securities Act of1933, the Securities Exchange Act of1934, the Sarbanes-Oxley Act of2002, Section23of the Federal Civil Procedure Law and the Private Securities Litigation Reform Act.The fourth chapter conducts a deep analysis of the solutions of the class action which Chinese companies listed the United States will face. Is divided into three levels, deal with procedural law litigation strategy, Chinese companies to improve their own response to the regulations of the United States and the Chinese government to strengthen the cooperation between international and domestic regulatory countermeasures. Especially from the perspective of procedural law, we propose a method to avoid securities class action.