Study On The Legal System Of Dividend Distribution Of Listed Companies In China

“The world is for profit; all profits go to the world.” The listed companies is thecornerstone of the development of the capital market, the listed company’s dividenddistribution policy directly determines the direction of the capital. Develop appropriatedividend policy, not only conducive to the sustainable development of the company’sown, to protect the interests of all relevant parties, the majority of investors in thecompany can also enhance the awareness of long-term investment, to attract long-terminvestors to enter the market, to reduce speculative behavior, reduce stock marketspeculative colors, in order to achieve optimal allocation of resources, give full play topromote the securities market financing function. Not only is it one of the major puzzlesof the area of financial management, the field of law is a difficult problem.The dividend distribution policy of listed companies by a variety of factors, such aslegal restrictions, the intrinsic preferences of the shareholding structure of theconstraints of the contract, the impact of the tax system, the level of regulatoryconstraints, and so on. The above factors force the formation of the pattern of dividenddistribution policy of listed companies. The means to achieve diversity, including cashdividends, stock dividends, property dividends, dividend liabilities. Of eight as much:not allocated cash dividends, bonus shares increase by transferring shares, cashdividends plus bonus shares, cash dividends and increase by transferring shares, tobonus issue plus Zhuanzeng shares, cash dividends plus bonus issue to rotate rightsissue.The general characteristics of the dividend distribution of listed companies inChina mainly include:1, the distribution forms, but is not quite reasonable. Mainlymanifested in the allocation of many kinds; cash dividend gradually be taken seriously,but the pay ratio is still low; bonus issue shares of capital expansion behavior"kidnapping" the phenomenon of cash dividends. The phenomenon does not allocate theproportion has decreased, but still quite common. Although the proportion allocated isshowing a downward trend, but still high compared with the mature stock market.3,illegal distribution of dividends behavior. The mainly symbolic cash dividends and highcamp and now even the high cash dividend popular. Dividend policy is the lack of stability and continuity. In different years, regardless of the choice of the distribution ordividend payout ratio are very different, the company’s development and investmentprospects are not predictable.China’s listed company’s dividend distribution system formed above featuresmainly because of several reasons: a legal guide for dividend distribution flawed, thelegal system incompleteness and variability. Distribution of listed companies premiseprovision does not explicitly set aside the required statutory surplus reserve anddiscretionary surplus reserve is not detailed enough. The illegal distribution of relief isalso lack of size-fits-all approach is not conducive to the protection of bona fideinterests of the shareholders, and clearly defined responsibilities of the directors andsenior executives are not illegal allocation behavior, reducing the binding of partitioningbehavior. The legal level of the relevant laws and regulations are relatively low, the lackof stability, reinforce each other, listed companies in China largely to the dividenddistribution policy instability and discontinuity.2, the equity structure is irrational.Although China’s securities market has been split share structure reform, has entered thecirculation times, but surviving on ownership concentration, due to dispersed ownershiplead to increased risk of internal control, affect the dividend distribution policy ofrationalization of the listed companies in China.3, the regulatory mechanism is notperfect, not only listed companies within the regulatory mechanism is not perfect, thesupervisory role of the Supervisory Committee and the independent directors have littleeffect, the external securities market regulation mechanism is not perfect, some of theregulatory measures of administrative interference means too heavy, there is no achievethe desired results.4, the tax system is unscientific. Current tax legislation listedcompany dividends distributed to shareholders of20%of the levy personal income taxpractices suspected of double taxation, and on the already modest dividend income levyhigh taxes, the alienation of the investment behavior of investors prefer speculation earnThe difference is not conducive to the stability of the securities market.Foreign listed company dividend distribution requirements of the legal system areboth similarities and slightly different. From the provisions of the dividend distributionguidelines and relief system, we can see that due to the different national conditions oftheir respective legal traditions and cultural background, and they were showing somedifferences and characteristics. Dividend distribution of listed companies in China’s legal system to build not only to learn from the advanced experience of foreigncountries, more importantly, should be based on China’s national conditions, to explorefor their own institutional arrangements.Has a sound legal environment is one of the essential characteristics of a matureand healthy stock market. China’s listed companies in the process of distribution ofdividends problems and that has an important relationship with our legal systemdeficiencies. Only continue to improve our legal system, standardize the dividenddistribution behavior of listed companies, in order to promote the sustainabledevelopment of listed companies, and to promote the benign operation of the marketeconomy. Admittedly, the law itself lags with the securities market with each passingday is almost impossible to sync, but we cannot give up eating for fear of choking.Further standardize and improve the dividends distribution system of the listedcompanies in China, a long way to go, from a multi-pronged approach.