Argument Securities Market Information Disclosure System

The difference between securities market and entity'market is that in the securities market , investors are buying commodities which are invisible or even touched. So the trasmission of information is as the sole basis for investors to buy securities. These all show that the information disclosure system as a securities law essence is especially important.This paper is divided into four parts describing securities information disclosure system, which focuses on the mandatory information disclosure system.By the introduction of the Enron bankruptcy case,the preface point that the purpose of this paper is to improve the securities of information disclosure system, ease stock market information asymmetry, increase trust between investors and market managers ,regaulate those illegle behaviors such as false statements, selective presentation, material information omission, postponed disclouser of information and so on.In a word ,the ultimate gole is to gain effective allocation of stock market rescourses and a healthy stock market . Also, the preface describes some basic theories and concepts such as voluntary information disclosure, mandatory information disclosure .Furthermore, this part systematically collate and analyze relative literature.The first part of this paper has a detailed description of the theoretical basis for mandatory information disclosure. Because of information asymmetry in current securities market in China and lack of confidence in the stock market ,our market has risk to the lemon market.On the other hand, managers and owners belongs to different subjects and the release of information will increase the issuer's management costs .All these will exacerbate the asymmetry of information.Our working is to solve the problem of asymmetric information disclosure, making the price fully reflect the securities's information. To make investors purchase securities correctly, market follow the laws of its development to achieve survival of the fittest, the configuration of resources be effectively, we must rely on the mandatory information disclosure system.Since the mandatory disclosure of information is so important, then what is the mandatory information disclosure and which it includes are described deeply in the second part of this paper . Because the U.S. stock market is more mature and the securities market legislation is relatively advanced around the world, this paper mainly explain the basic content of the mandatory information disclosure of america which is mainly for the "material facts "disclosure. At the same time the second section also describes the United States Securities Act of implied civil liability, inversion of the burden of proof of insider trading ,which show common law characteristics.However, the mandatory disclosure system is not omnipotent, in addition, investors'quality will also affect the effectiveness of information disclosure.So the third part of this paper describes that to achieve an efficient market,we not only relye on the mandatory information disclosure system but also investors'high- quality .Finally, acorrding to China's specific condition the last part of this paper analyzes auditing system of information disclosure is still our country's suitable choice and mandatory disclosure system is the development trend of China's future. Meanwhile, for the effective implementation of information disclosure system, this paper presents some specific recommendations such as compensation mechanisms for civil litigation , inversion of the burden of proof of insider trading, improvement of the investor structure.China's Securities Law provides for civil liability for violations of information disclosure act, but this is only from the perspective of substantive law to regulate the illegal disclosure act.In practice, due to lack of appropriate mechanisms for supporting the lawsuit, litigation representative can not be elected , or because the litigants do not register on time, the amount of compensation is far less than the actual amount of compensation .The article puts forward an improved recommendations: improve the litigation representative of the system, change the legal registration system. According to China's Criminal Procedure Law, only huge amounts of property from unidentified sources and the illegal possession of the implementation of the Crime provide for burden of proof. Allocation of burden of proof in criminal proceedings is an exception, it changes the presumption of innocence in criminal proceedings. If guilty party can not adduce evidence to prove his innocence, he will be presumed guilty, which is more stringent requirements for him. At present ,it's difficult to gain evidence in insider trading behavior. It's difficult to prove that the suspects are aware of inside information at the time of transaction ,or even aware of inside information ,whether his subjective minds have influnence on his trading behavior is also hard to know. Because the evidence is difficult to get ,appropriate disclosure violations can not be effectively punished. In view of these, this paper proposes the introduction of insider trading in our burden of proof requirements.The number of institutional investors is more than individual investors in a standardized and orderly securities market. Also ,institutional investors is more rational than individual investors. In order to enhance trust on the securities market, it's necessary to cultivate institutional investors in china.