Research On The Legal System Of Chinese Development Of Preferred Stock

Preferred stock is a basic type of share international, which is equallyimportant and common stock status. It has been widely used in westerncountries, and it plays a great role in railway, finance, real estate and otherfields, so it has promoted the development of economy. Especially in2008,with the outbreak of the global financial crisis, the United States governmentand related enterprise spend huge sums on buying the verge of bankruptcyenterprises preferred stock to walk out of predicament and provide power.Although Our country had stipulated the preferred stock, in both1992promulgated the "Limited by Share Ltd " standard opinion and2006promulgated Provisional Measures on Administration of Venture InvestmentEnterprises. However, at present our country legal research on preferred stockis not in-depth, comprehensive, system." Company law " authorizes the StateCouncil on issuing other types of shares, and dosenot clear provisions ofpreferred stock, and stock market has no preferred stock in Shanghai andShenzhen.But can it serve for the development of Chinese market economy?Preferred stock plays the important role in China’s economic development.Preferred stock is beneficial to balance Chinese corporation governance, andpromotes the reform of state-owned enterprises, and guarantees the value ofstate-owned assets. Preferred stock broadens the financing channels forenterprises, and injects new vitality into the development of enterprises, andpromotes the development of venture enterprises. Preferred stock conducivesto innovation of social pension funds investment, and increase socialendowment insurance fund, and make up the huge gap of China facing socialendowment insurance fund. Preferred stock optimizes the structure of China’ssecurities market, and promote the development of equity diversified species.If China needs preferred stock, then how should the trial? This will be theneed to face and solve problems in the future development of company law.Therefore, we need to research further on the preferred stock system. Theauthor provides legislative suggestions for preferred stock of the initialestablishment of legal system, Learning from the experience of westerncountries and the preferred stock system development, combined with China’sspecific national conditions, trying to find a breakthrough for preferred stocksystem, to promote the funds circulation, allow funds to produce greatereconomic benefits, and make contributions to the reform and development ofour country economy. Author starts from the basic problem of preferred shares, preference shares, and introducs on the history, definition, characteristic, andput forward clearly preferred shares in China’s basic attribute, and thenexplore the value orientation of the preference shares of the legal system inthe balance of interests and institutional rationality. According to its force in thedevelopment of preferred shares of the " economic recovery after the financialcrisis ", the preferred shares can open up new investment channels for socialendowment insurance fund, and promote the endowment insurance fund. Withthe local resources of China’s legal culture and legal system, the author putsforward that our country should choose to qualitative legislation mode,legislation pattern as the authorized legislation mode, through the analysis andcomparison of common law and civil law legislation mode. Distinguishingmandatory regulations and licensing regulations, China’s current " companylaw " relevant legal provisions, establish preferred stock issuance of actualoperating procedures, norms of preferred shares in their first day of trading tofurther improve.