Securities Fraud, False Statements Civil Liability Mechanisms Shah

The beginning and developing of the securities business in China is immature and having great deal of deficiency, leaving space for the securities fraud, esp. for the misrepresentation. For s long time, the misrepresentation of securities market is only regulated by the Administrative Law in China, until the amendment of the Criminal Law in 1997. Nevertheless, the criminal and administrative responsibility cannot bring any actual benefit to the victim. Suing the misrepresentation under the Civil Law is the only way to compensate the damage. However, there are short of regulations about the obligation of the principal, the doctrine of liability fixation, the measurement and amount of the compensation in the Civil Law. So, to meet the need of the fleetly developing securities market, it is extremely necessary to establish a mature civil responsibility system against the misrepresentation.Some countries have established mature regulations, which are dead against the misrepresentation, e.g. America and Japan. The victims can recover their right by civil remedies in Taiwan Area too. Based on such backdrop, this dissertation focuses on the fundamental issues relating to the civil liability for the misrepresentation in securities litigations from the perspective of comparative law. The theme of the dissertation is how to establish the civil liability system for misrepresentation that is in perfect harmony with the present national situation in china, by drawing on the experiences related to the other countries in both regulatory and judicial practices in this field.The dissertation is organized in a straightforward way with three parts as well as the preface and the conclusion.Part One discusses China' s possible framework on civil liability for misrepresentation on the basis of a comparison between the system of civil liability for misrepresentation of the relevant countries and the relevant provisions of China. The author argues that Chinese securities laws shall adopt intrusion liability and contract liability for misrepresentation based on tort law principles, so that investors who acquire securities fromdifferent markets can resort to the sufficient remedies.Part Two analyzes the constitutive requirement of civil liability for misrepresentation from the points of misrepresenting subject fault, doctrine of liability fixation, harmful consequence and cautionary relation. As to cautionary relation, the author should draw lessons from American putative fiduciary rule and fraud on the market theory, in order to reduce the proof demand of investors and defend the rights of wide middle and small investors. As to doctrine of liability fixation, the author thinks that, be in line with the subject merit to design of the system and good developed view of securities market.Part Three is the discovery on questions about system of relief on substantial law from the point of judicial practice that included two parts. Based on the legislation and judicial practice of China and foreign countries, this part discusses the problem of the scope of the proper plaintiff and defendant. If the problem of the proper parties is resolved correctly, the rights of the investors could be protected promptly and effectively, and the suit on the court could be made efficiently.