Legal Research On The Legality Standard Of Anti-takeover Measures Of Listed Companies In China

The anti-takeover measures refer to the resistance actions taken by the target company against hostile takeovers,such as the Poison Pill program,the White Knight scheme,revision of the Shark Repellent clause,and so on.Anti-takeover measures originated in the United States at the earliest and have a long history of experience in Western countries.The target company's implementation of anti-takeover measures not only can resist external hostile takeovers,protect the long-term interests of the target company,but also can help the target company to undertake social responsibilities.However,if the anti-takeover measures are implemented improperly,they may also have very negative effects,such as infringing on the legitimate rights and interests of the target company shareholders,weakening the company's external supervisory effect,and even undermining the country's normal economic market order.The history of anti-takeover is not long in our country.The first anti-takeover case in China occurred in 1993,Shanghai Yanzhong Industry reversed the takeover of Shenzhen Baoan Group.However,in the following two decades,takeovers and anti-takeovers have developed rapidly in our country's practice.In recent years,with the continuous development of the market economy,there is a new wave of takeover and anti-takeover in China.The most representative among them is the takeover of Vanke shares.Affected by malicious invasion by “barbarians at the door”,more and more listed companies in China have taken precautions to revise anti-takeoverprovisions and implement anti-takeover measures.Although anti-takeover has been developing very rapidly in China's practice,the legal system of China lacks systematic regulations on anti-takeover measures.Under the current legal framework of our country,the regulation of the anti-takeover legal system basically remains on the principle of regulation,and there is even still a law gap in some aspects of anti-takeover.The legal absence of anti-takeovers has made it impossible for China to establish a uniform judgment on whether the anti-takeover measures are in compliance with the law.Most of the anti-takeover measures implemented by listed companies in China are based on foreign anti-takeover experience.These measures may not be legally available in China.The lack of standards for the legality of anti-takeover measures can easily lead to disputes between the acquirer and the target company on the legality of the use of these anti-takeover measures.Many takeover battles are also cannot be judged because of the lack of legitimacy of anti-takeover measures,and they are often terminated by administrative agencies intervening in mediation.This shows that China's failure to establish standards for the legitimacy of anti-takeover measures will not only affect the normal acquisition and anti-takeover activities of the acquisition parties,but even disrupt the normal order of the securities market because of too many administrative interventions.On the other hand,many western developed countries have established their own set of criteria for judging whether or not anti-takeover measures are legal through their rich anti-takeover legal practice experience.Therefore,the author believes that China urgently needs to learn from the rich foreign anti-takeover experience and combine with China's actual national conditions to establish a set of China's legal system for the legality of anti-takeover measures.From the framework and content of the paper,this paper is mainly divided into four chapters.The first chapter is the introduction to theory and practice of China's anti-takeover measures.In this chapter,the author first listed the two most representative cases in the history of China's anti-takeovers: Dagang Oilfield's acquisition of SHANGHAI ACE CO.,LTD and Baoneng's acquisition of Vanke.In the following sections,the author analyzes the specific legal provisions of anti-takeoverin the anti-takeover practice.In addition to this,the author also analyzes the attitude of China towards anti-takeover.Based on the analysis of two cases and the legal provisions,the author believes that there is a problem in the practice of anti-takeover in China.The problem is that there is no uniform standard for the legality of anti-takeover measures.The second chapter examines the legality standards of the US anti-takeover measures.The United States is the country with the earliest and most mature development of anti-takeovers.Therefore,the legality standards of the anti-takeover measures of the United States have important implications for China.The legality standards of the US anti-takeover measures consist of statutory laws and case laws.The statute law provides a legal basis for the implementation of anti-takeover measures firstly.The case law then establishes the review criteria for anti-takeover measures under different circumstances,such as the Cheff rule,the Unocal rule,the Revlon rule,and the Blasius rule.In this chapter,the author introduces and analyzes the rules of the anti-takeover law and the case law of the United States.The third chapter discusses the establishment of China's own legality standard for the anti-takeover measures.First of all,since China's actual national conditions are different from those of the United States,the legality standards of China's anti-takeover measures cannot completely copy the United States.After drawing lessons from the US legality standards and combining with China's actual national conditions,the author believes that China's legality standards should be constituted by the guiding principles of anti-takeover measures and specific legal standards.Among them,the guiding principles of the anti-takeover measures include the principle of maximizing the interests of shareholders,the principle of equality of shareholders of the company,the principle of disclosure of anti-takeover information and the principle of anti-takeover proper procedures.The specific standard for the legality of anti-takeover measures include whether the implementation of anti-takeover measures violates the directors' fiduciary duty,whether they violate the law's mandatory requirements,and whether they violate the company's social responsibilities.In addition to this,China's legal system also needs to cooperate with the establishmentof legality standards,such as unifying and establishing special anti-takeover laws and strengthening judicial supervision in anti-takeovers.The fourth chapter is about the specific legitimacy analysis of some commonly used anti-takeover measures in China at the present stage.Anti-takeover measures are divided into pre-defensive measures and post-confrontational measures.The former includes the employee stock ownership plan,poison pill plan,shark repellent provisions,etc.The latter includes the White Knight program and scorched earth policy.In this chapter,the author will combine the above legality standard of the anti-takeover measures to examine whether these anti-takeover measures can be implemented under the legal framework of China and provide relevant legality recommendations.