Listed Company To Withdraw From The Legal System

Delisting refers to the removing of the securities of a listed company from listing on a stock exchange. As Jong as a listed company falls below certain continued listing criteria, which the Exchange has adopted, to a certain degree, the delisting occurs. The delisting mechanism is necessary for the development of the securities market, especially, in consideration of the optimal resource allocation function of market; it is also the requirement of the principle of "survival of the fittest" in the market; furthermore, delisting mechanism will exert pressure on the listed companies to help bettering the corporate governance and establishing the scientific and sound mutual conditionality, thus, in turn, to improve the quality of listed companies as a whole. Although china has adopted the delisting policy and put it in practice on the section of the deficit companies ,but the unique function of delisting mechanism, "get rid of the stale and take in the fresh",has not been fully deployed in china's securities markets. This requires that no efforts should be spared in improving the existing delisting mechanism. In this article, the author made such efforts in the study of the legal related issues of the delisting mechanism.Besides the foreword and the epilogue, the article consists of four main parts:In Part One, the author mainly talks about the values of the delisting legal system. The author holds that the delisting legal system basically has three great values: Order, Efficiency, and Protection of the investors.Part Two is about the rational supervision pattern for the delisting, and its juisprudenial analysis. It is said that on the issue of delisting, the stock exchange should play a major role in maneuvering of delisting based on the agreement with the delisted company. Inconsistent with the general opinion that the agreement between the exchange and the delisted company is merely a pure civil one, the author holds it should be labeled as a " mingled agreement".In Part Three, the delisting channels, the delisting criteria and the delisting procedure are discussed. The delisting channels can be divided into two sorts: one is the removal from the list that forced by the exchange; the other is the withdrawal from the list upon the request of company. Lacking of market-oriented merger and acquisition, the existence of "shell resources", and the severe local protectionism contributes to the obstacles of the delisting channels in china securities markets. Refering to the delisting criteria, after making a comparison between the criteria of the overseas mature securities markets and that of the china ones, the author suggests the delisting criteria should be made and deployed by the exchange instead of the SEC. On the delisting procedure issue, it is said that the set of procedure consists of two sub-procedures: the buffer-zone procedure and the dispute settlement procedure.Part Four deals with the legal responsibilities relating to certain delistings in favor of the investors. The author makes a thorough analysis of the principle of "self-sharing"(risk), then concludes that "self-sharing"(the investing risk) and sharing legal responsibilities is not contradictory, but consistent. They two together would compose a sound risk sharing system for the securities markets.