Legal Researches On Promises Of Split-share Structure Reform

"The split-share structure" is the product of our country during a particular historical period, whose contributions to our country's security market will never fade out. Even so, there are still some striking disadvantages of this system, which are becoming the roots of all evils in security market. With April 29, 2005 China Securities Regulatory Commission "The notice of Pilot work regarding the reforms of the structure of split share in listed company" as the sign, the reform of "the split-share structure" was formally started. It has been four years since the reform had been launched, the reform of listed companies almost finished and entered into a period called post-reform age. Just during this period, problems which have not been foreseen or been foreseen but were not fully argued at the very beginning of the reform exposed. The concentrating representation was that non-tradable share holders broke their promises which they made in order to pass the plan of the reform at that time. This phenomenon has been widespread and destabilized the security market, further, it was a big challenge to our legal system construction. This paper attempts to make a systematic and comprehensive analysis of the problems related to the split-share structure reform through a integrated application of some theories of Contract Law, Security Law, Company Law and Procedure Law, and to make the theories guide the practice.This paper is divided into five parts mainly: Part one firstly gives a brief introduction to the concept and cause of "The split-share structure", and then introduces the concept and meaning of "The split-share structure reform", in order to help the readers to make some knowledge on the background of the split-share structure reform.Part two discusses the character of the plan of split-share structure reform. Firstly, it defines the split-share structure as a contract between civil subjects, and the split-share structure reform is a compulsory alternation of the original contract under the effects of national policy. Secondly, it makes a qualitative analysis of the plan of reform, the form of split-share structure reform, and defines this as a new contract instead of the original one. It also explains the connotation of the plan of split-share structure reform by analyzing the subject element and object element.Part three analyzes the promises made by the non-tradable share holders to the tradable share holders, that is the promises of split-share structure reform. Firstly, it analyzes the quality and character of the promises of split-share structure reform, and put forward this paper's point on the basis of comparison between different doctrines in academic field. The point is that the promises of split-share structure reform are contracts between non-tradable share holders and tradable share holders, however, because relating to legal relations of security law, this kind of contract has mandatory, guidance and technical characteristics besides the characteristic of autonomy of will. Secondly, this paper introduces and analyzes the types of promises of split-share structure reform, including the statutory promises and the additional promises.Part four is a legal analysis of the problems arising in performance of promises ofsplit-share structure. It mainly discusses (1) Subject problem—Parties are not qualified(including the subject of promise is improper and subject of performance is unqualified); (2) Object problem—Performing acts are inappropriate (including the flaw of performance object and time of performance is not clear);(3) Inspection problem of problem performance, making a concrete analysis of government supervision's legal foundation as well as the present situation. This part is where the difficulty lies. The main difficulties are: There're too many types of promises of split-share structure reform; problems arising in performance are extremely complex and it's a very difficult task to collect and arrange the problems even form a system at last.Part five discusses liabilities and remedies of non-performance of promises of split-share structure reform. Firstly, it analyzes promise subjects' administrative liability and civil liability for non-performance of promises. And civil liability may involve the liability for breach of contract, tort liability for false statement and tort liability for non-tradable share holders abusing their rights. Secondly, It analyzes civil remedies for non-performance of promise. This part mainly discusses various problems rising in the civil action launched by subject of rights of split-share structure reform to investigate subject of promises' liability for breach of contract, including the plaintiff and the defendant, conditions of action, jurisdiction, and forms of action.