The Study On The Supervision Of The Public Company’s Selective Disclosure

The basis of effective operation of the securities market is investors’ confidence. The most critical factor affecting the confidence of investors in the securities market is informational environment. A stock market with good information disclosure system and the system is completely implemented by securities issuers to ensure fair treatment to all investors, protection of the basic rights to know the issuer and its securities, such securities market is the investors can trust. The only way the securities market can keep investors for a long time. Then securities markets can be normally operate, playing its proper function. Compared with the securities markets of the United States, the countries of EU, China’s securities market started more lately, but developed more rapidly. At the same time, problems exposed by the securities market more and more serious in China’s stork market, such as, false statements, market manipulation, insider trading, selective information disclosure, etc. The first three problems have always been obvious because of their great destructive impacts on the securities market. So, they have been in the scope of regulation of the Securities Act. However, the selective disclosure of information because of its legal nature is unknown, with no significant and obvious effect on the securities market, has an effect on the public companies’ information disclosure, so it has not yet been subjected to proper supervision.This article chooses the selective information disclosure of listed companies as objective in this context, making use of the methods of comparative analysis, case studies, law and economics, and other methods to research the nature,the hazard of the act, the regulatory basis and how to regulate in the following four parts:First, I define the nature of the acts of selective information disclosure of listed companies in the first part of this paper. Then through the comparison between similar concepts, I describe the characteristics of the selective disclosure of listed companies and the possible hazards on the securities market. The final conclusion of this part is a listed company selective information disclosure may be preparatory acts of insider trading, its nature is very similar to tipping, which will increase the risk of insider trading.Secondly, the second part discusses the controversies about whether selective information disclosure of listed companies is regulated, as well as its reality basis of the regulatory and legal basis. The main opinion is that the act has become a stock market "hidden rules",which has a seriously negative impact on the securities market, besides that it has violated the principals’ requirements of fairness, justice, and openness, which is the basis of the security market.So it should be regulated.Thirdly, the paper inspects the relative legislation and judicial practice in the United States and the European Union.The part studies the United States and European Union’s regulatory philosophy, regulatory rules, the regulatory body, regulatory approaches, law enforcement, etc. in detail. So that I can find the reference from them for the supervision on the selective information of listed companies in China.Finally, the fourth part of this paper summarizes the present regulatory rules and typical regulatory practice at first. Then this part tries to find the problems of the supervision of the selective disclosure in our country by comparing ours with the United States, the European Union legislation and law enforcement practice.The problems present as following aspects:loose regulatory environment, absence of regulatory bodies, unknown regulatory philosophy, and the absence of regulatory rules. The paper provides recommendations of the reconstruction of the regulatory system of selective disclosure in the public companies based on the analysis.