Securities Civil Dispute Resolution Mechanism

The aim of this paper is to solve the dilemma of securities litigation: individually litigation cost is much greater than putative recovery. In order to protect the rights of the stockholders and investors in the security markets, it's necessary to establish an effective legal remedy system in the Chinese capital market. A perfect mechanism for civil disputes resolution, including securities mediation, securities arbitration and securities litigation, is very important for the victims in the Chinese securities markets. Chapter one looks back the history of the securities arbitration and securities litigation in China. The outstanding dilemma of the securities civil disputes' resolution is summarized in this chapter. It analyzes how necessary and important to establish a new resolution mechanism in the securities market. Chapter two introduces the securities arbitration and securities class action in the United States. By comparing the resolution mechanism with the one in the United States, chapter two furthers the understanding of securities arbitration and the securities class action, and analyzes their effectiveness. It emphasizes the securities class action of the United States, reviews its procedures and analyzes the procedure arrangement in detail. Chapter three and chapter four illustrate how to establish the new resolution mechanism in China. According to the reality in Chinese securities markets and civil judiciary, the paper advises to construct a complex mechanism for the securities disputes resolution, which includes civil meditation, arbitration and litigation. The detailed ways to perfect the three methods of the securities resolution mechanism have been suggested in the last part of the paper.