Study Of Market Manipulation Of The Civil Liability System

Market manipulation generally refers to such practices as wash sale, matched orders or rigged prices. These practices are all ultimately intended to produce a market for the securities, which has little or no bearing on the true value of the securities based on the real business of the issuer and its true prospects. That is to say, market manipulation violates the integrity of the market because it alters the independent trading and pricing mechanisms of the market. What's more, in a market manipulation, investors are deceived or defrauded by those who artificially affect the price of securities and thus usually lose money because they are left holding what has become worthless stock. In order to prevent or punish the illegal act of market manipulation effectively, the securities law of different countries usually attaches great importance to civil liability and permits the damaged party to take legal actions in civil law. But now in our country, of market manipulation civil liability is much thinner than its administrative and criminal liability either in law making, research or law enforcement. However, to buiId the civi1 liability system of market manipulation is the objective need of market economy and the most important part of the securities law. Therefore, this article mainly discusses how to build a scientific system of the civil liability on market manipulation in our country. The contents of this article can be divided into four parts as follow:The first part of this article first discusses the relations between market manipulation and other securities fraudulences, then puts an emphasis on such aspects about distinct kinds of market manipulation as the concepts, the ways on how to manipulate securities market and how todistinguish the acts of market manipulation in law.The second part of this article discusses that the intention of manipulation is a necessary requisite for market manipulation. Furthermore, it is proper for us to apply special rules on the liability to give evidence on the proof of intention.The third part of this article mainly discusses the causal relationship in market manipulation, which is a block of the enforcement of the law against market fraudulences. Because market manipulation is a kind of special tort, the author agree on the use of the "proof to the contrary" theory to lighten the proof burden of the damaged party in causal relationship. Besides, this part also discusses such issues as how to decide the scope of legal plaintiffs, how to assess the losses of the damaged party.The fourth part focuses on the improvements of the subjective requisite, the objective requisite and other aspects of market manipulation in law making. What's more, it gives some comments on the rules of the 71st provision in "the Securities Law of the People's Republic of China", which is special in anti-manipulation in Chinese securities market. By this means, it points out some faults of our country's securities law and gives some advice on improvements.We believe that if the civil liability system of market manipulation can be built rapidly and scientifically, the efficiency and justice of the securities market in our country will be accelerated.