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Study On Dual-class Share Structure System In China

Posted on:2021-01-04Degree:MasterType:Thesis
Country:ChinaCandidate:Y TongFull Text:PDF
GTID:2416330623470869Subject:Economic Law
Abstract/Summary:PDF Full Text Request
Dual-class share structure is a common share allocation system in developed capital market.The founding shareholders of a dual-class company guarantee that they can gain control of the company with a lower shareholding ratio by dividing the shares into categories with different voting effects.In essence,the dual-class share structure is to stabilize the absolute control of the founding shareholders by limiting the voting rights of certain shareholders.The design of dual-class share structure has gone through several centuries of overseas practice and proved its positive significance.Due to the need of large amount of financing for the development of enterprises,it is difficult for the founder to attract capital into the project to continue to control the company,and there is often a potential risk of hostile takeover.In the case that the existing laws cannot combat hostile takeover,the application of dual-class share structure is of great significance to deal with hostile takeover.In particular,in the context of the full development of the innovative Chinese economy,China's Securities Regulatory Commission(CSRC)in 2019,based on the special requirements of the financing and development of Internet emerging enterprises,has enabled such enterprises to apply for the differential voting arrangement,that is,the dual-class share structure to be listed on the science and innovation board.Because our country capital market and legal environment in some ways there and doesn't fit the dual-class share structure,especially the public investors in China compared with western countries generally lack of investment in reason and sensibility,dual-class share structure to a certain extent can become controlling shareholders abuse investors interests and rights of the tool.Therefore,in order to fully realize the positive effect of dual-class share structure,we must establish a complete share system in line with China's market economy.Although there are relevant regulations and social practices,the system still has the following problems: the lack of laws and regulations,the imperfect design of internal provisions,the lack of supporting mechanisms to protect.To solve the above problems,this paper proposes the following countermeasures: formulate relevant laws and regulations,improve the design of internal provisions,and support safeguard measures,such as strengthening the company's information disclosure system to prevent the founding shareholders with special voting rights from using the decision right to harm the interests of minority shareholders;Giving play to the supervisory role of independent directors to strengthen supervision over founding shareholders;The class action lawsuit system is established to provide the supporting protection mechanism for the minority shareholders under the dual-class share structure.The improvement of the specific contents of the dual-class share structure system is crucial to the sustainable development of China's capital market and the continuous rise of its comprehensive strength.
Keywords/Search Tags:Stock rights, dual-class share structure, special voting rights, right to vote
PDF Full Text Request
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