On Protection Of Medium And Small Shareholders During The Acquisition Of Listed Company

The interests’protection of small shareholders in acquisition of listed companies is one of the most important basic problems in modern company system. During the purchasing, the effective protection of their interests could not only ensure the healthy development of the company and the enthusiasm of investors, but also is the key to stable development of the capital market. Therefore, the protection of the interests of minority shareholders in the takeover of the listed companies has been valued by governments. With the company’s ownership structure dispersed, the number of small shareholders is increased. For there shareholding proportion is too small, its inclination could not act in the capital majority decision system. In fact, the purchaser and the controlling shareholders encroach on small shareholders continuously. Thus, the interests of small shareholders protection issues in the acquisition of the listed companies have attracted more and more attention of the society.In acquisition process, the protection mechanism carried out by our government for small shareholders is not perfect. In the past," company law" is drawn up to adapt to the reform of state-owned company, which paid insufficient attention to shareholders’ interests, and did not give a clear specification for concrete operation of shareholders’ voting rights shareholders’ litigious right and civil compensation. The relevant legal system is not able to give corresponding support and protection in the rapid development of the market, which makes demand to our legal system construction of the protection of small shareholders in the takeover of the listed company. Hence, combining China’s market development based on the fact, we should learn from foreign advanced legislation and practical experience to establish and perfect our protection system for small shareholders’ interests in listed company acquisition. First, the article elaborated the small shareholder rights and interests protection in legislation in acquisition of listed companies, which analyses in the adequate disclosure system of information, compulsory offer acquisition system, eliminating system of shareholder voting, legislation in the process of anti-takeover and perfection of company management several aspects separately. The information disclosure system also aims to enable investors to access to information adequately, avoiding harm to small shareholders in target company interests caused by market information asymmetry; our original" Securities Law" has used a mandatory general offer acquisition pattern. The revised" Securities Law" increases the partial acquisition mode of offer, which is more conducive to the target company’s small shareholder’s rights and interests protection in the acquisition of Listed Companies; eliminating system of shareholder voting is basic safeguard to justice and free exercise to voting, and its main function is to prevent the large shareholders take advantage to harm the company and other shareholders’ interests; the current law of our country in anti-takeover system is blank in legislation, which is not conducive to small shareholder rights and interests protection in the target company. We should absorb the British and American pattern and desirable things, according to different effects, distribute the rights of decision-making of anti-takeover to AGM and the board; shareholder derivative litigation system not only improve and increase minor shareholders’ rights, but also endows shareholders the possibility to take judicial relief, which is still lack of certain maneuverability in the implementation process and the specific implementation still exist deficiencies and the need to improve and perfect. It is the most fundamental and effective way of solving problems of small shareholder rights and interests protection to illustrate the protection in perfection of governance structure of listed company aspect.Secondly, the paper stated the rights and interests protection of minority shareholders in target firm in the acquisition of listed companies. Encouragement to acquisition of listed company does not mean that the normative problem become less important. To protect the medium and small shareholders’ legal rights and interests in targeted company, we should give the necessary supervision.Finally, it discusses judicial relief to the interests of small shareholders in the acquisition of listed company, mainly from the perfecting minor shareholders litigious right and civil compensation mechanism two aspects. The regulation of "company law" revised has made great progress but still lack the certain maneuverability, which still exist deficiencies and the need to improve and perfect in the specific implementation. First, in the aspect of legislation it should strengthen shareholder lawsuit’entity and procedure improvement, second, we should make relevant judicial interpretations to strengthen the specific provisions of operability in reality. In third, the level of judicial personnel has to be raised to improve the whole social justice environment.