Comparative Studies On The Theory Of Civil Liability Arising From False Statement On The Security Market Between China And The U.S.

There is no way for the public to vote except the information is disclosed.There is a word from the recently famous reporter Chai, Jing. I believe this word can be used for more than environmental protection, but also the securities market. China’s capital market shows a booming trend, the securities regulatory system is increasingly perfect. As of December 31, 2014, the aggregate amount of capitalization in both Shanghai Stock Market and Shenzhen Stock Market’s has been increased to RMB 3.725 billion, the number of the accounts initiated by the investors has been increased to 243 million. This year the total amount of Chinese stock market capitalization has exceed the Japan’s and ranked at the second place worldwide.Under such a large social investment scale, as well as the relevant economic legal systems are maturing, the phenomenon of illegal information disclosure of listed companies however has been continuously repeated, investors often suffer economic losses, securities regulation and law enforcement issues of concern.Information is the key resource of modern business activities, is an important basis for business conduct adequate evaluation. As China’s securities law provides, the listed companies has continued obligations of information disclosure. But the fact that the information asymmetry makes the proliferation of false information so that investors cannot get accurate and true in the efficient market, complete information, you cannot fully understand the business situation and development prospects, a departure from the openness of the stock market, investors blind or make a misjudgment untrue, thereby suffer. On the other hand, the issuer by spreading false information seeks illegal interests. Securities misrepresentation civil liability mechanisms relevant rules have been introduced more than ten years of litigation with little success, China’s capital market information deregulated, facing a crisis of confidence. We should re-examine the legislative issues, learn from the American experience, to explore a civil action for misrepresentation China Securities suitable way.As regards to the United States, Securities Act of 1933, Securities Exchange Act of 1934, as well as the federal Securities and Exchange Commission under the provisions of 10b-5 authorized to develop, are a step by step to establish a violation of the securities misrepresentation(under the rule, including the material facts misrepresentation, misleading statements and material omissions facts) and its legislative benchmark mode civil action for damages, and on the basis of long experience and gradually worked on the case law and the creation of a series of sophisticated information disclosure of listed companies criteria violations concluded that the burden of proof in the form of sharing and group action to establish more.It is noticeable that the Supreme Court held in 1975 for the first time in the form of a clear misrepresentation Securities Litigation private right of action. To alleviate the burden of proof on the plaintiff, a measure of actual securities fraud litigation, re-allocation of the burden of proof and reasonable, the US Supreme Court in the 1972 case of Affiliated Securities infringement for making major breakthroughs identified a causal relationship-trust presumption applies.Reliance on the presumption applies, the American Law Institute in the market for household use fraud to economic theory, deduced the existence of a causal damage suffered between investor relations and misrepresentations, which inverted the burden of proof on the defendant to refute, and effectively protect the small investors those in the stock market and the real interests of the disadvantaged position damaged, such principles of reliance rules was formally adopted in Basic. At the same time, the United States securities laws also adopted the safe harbor rules, reasonably from the listed company of the company’s future development and prospect of appropriate expectations, better help investors make a value judgment and decision making.In contrast, the rapid development of our country’s securities market and lagging regulation can’t umbrella as small and medium-sized investors. In China since the Supreme Court issued the relevant provisions of the 2003 is for the false statement civil action sets the prior procedures of administrative or criminal penalties, only in the authority of the listed company information disclosure violations made official, after the fact that investors can only be in the form of separate or joint action to false statement civil tort, demand compensation for economic losses.In conclusion, China as an interim measure of pre-programmed hinders private investors to exercise the right to appeal a false statement about the loss of trust, which should be repealed. To better wake rights awareness center investments, litigation is difficult to solve the plight of small investors, in particular, has a particularity in the securities markets, China should establish trade associations investors started to gradually introduce the concept of class action. Reliance on the presumption of a causal relationship-oriented use, we should further strengthen the American theory of learning, and the safe harbor rule shall be established.