Research On The Legal Restraint Mechanism Of Listing Company Under Anti-Takeover

With the acceleration of equity reform in China,the establishment of the full circulation system of listed companies and the intensification of the trend of equity diversification of listed companies,plus the new Securities Law of 2005,which allows acquirers to issue an offer to all shareholders to acquire only part of their shares after holding more than 30% of their holdings,it is easier to control listed companies by making an offer.In the face of hostile takeovers,the target company's board of directors,shareholders show a different attitude.Under the hostile takeover,because of the particularity of the status of the board of directors of the target company,it has the possibility of abuse of power to hinder the hostile takeover,so as to harm the interests of the company and shareholders.Second,the choice of a controlling shareholder in the target company to accept an offer,taking into account its own short-term interests,may be detrimental to the company,minority shareholders and other stakeholders.Finally,the result of improper anti-takeover decision of the target company will have a certain impact on the hostile takeover as the way of external supervision and governance of listed companies.Therefore,the primary goal of establishing and perfecting the relevant laws and regulations of the target company under the background of hostile takeover is to regulate the behavior of the directors and shareholders of the target company.Therefore,this paper will baseon the reality of the target company in China's capital market,through the study of the extraterritorial regulation of the target company's legal system,on the basis of its comparison to improve China's existing regulatory legal system for target companies.The full text is divided into three parts:The first part of the article is an overview of the legal system of the target company under the background of the existing regulation of hostile takeover in China.This section first defines the concepts related to the subject matter of this article(hostile takeover,target company and legal restraint mechanism).Secondly,it discusses the necessity of legal regulation of target companies under the background of hostile takeover,including conflicts of interest arising from agency costs,protection of minority shareholders and other stakeholders,and hostile takeovers can be used as external corporate governance tools.After expounding the above necessities,combined with the current laws and regulations governing the takeover and anti-takeover in China,this paper summarizes the drawbacks in the regulation of the target company in the laws and regulations of our country,including the ambiguity of the director's fiduciary duty and the lack of review institutions and standards,lack of protection mechanism for minority shareholders' rights under the rules of the board of directors,and the imperfect supervision system of the target company in China.The second part of this paper summarizes the different models of the legal restraint mechanism for target companies and selects the United States and Singapore as the representatives of these two different models.This part first introduces the legal restraint system for the target company in the United States and Singapore,secondly introduces the scope of the rights of the board of directors of the target companies of the two countries,and finally summarizes the similarities and differences in the laws governing the target companies in the United States and Singapore on the basis of the comparison between the two countries on their legal restraint system.The third part of this paper puts forward some suggestions on perfecting the legal system of the target company under the background of the existing regulatory hostile takeover in China.This part first puts forward that we should clarify the power of the board of directors of the target company in China,secondly,it provides someideas for the materialization of the fiduciary duties of the shareholders of the target company,then puts forward some suggestions for refining the content of the fiduciary duties of the directors of the target companies in our country,and then puts forward the examination criteria of the directors duties,and finally conceived the supervision review system of the target company which can establish a combination of professional committee,CSRC and court review in our country.