The Study On 'Block Holder Disclosure Regulation'

The block holder disclosure regulation imposes an investor who holds a listed company's shares or other listed equity securities to a certain critical ratio an obligation to report to the securities regulatory authority and to inform the listed company to disclose it publicly.As far as the current situation is concerned,there are a large number of activities in China's securities market activities that ignore the disclosure obligations of large-value shareholding changes and undermine the acquisition of legal supervision systems by listed companies.The block holder disclosure regulation needs to attract more attention.There are also many shortcomings in the design of the regulation itself.The voice of the theoretical community on perfecting the block holder disclosure system has never stopped.In practice,listed companies will increase the disclosure obligations of shareholders by modifying the company's articles of association and involving anti-acquisition clauses,changing the rules of change of rights and restrictions on voting rights.From the current practice point of view,the attitude of such anti-acquisition clauses for reducing disclosure obligations is not absolute.Most listed company have revised these clauses of the articles of association which results in the reality that the disclosure obligations are reduced to avoid violating the law.The path at the autonomy-management level does not work,and whether the relevant provisions at the legal level should be directly revised such clauses has also been controversial.Comparing the mature overseas markets,China's block holder disclosure regulation is far from satisfaction at the design level.The lack of the regulation is also reflected in the actual application.The effect is unsatisfactory.First of all,the setting of the slow-walking rule has been controversial.Secondly,there is a clear deficiency related to China's block holder disclosure regulation that it adopts a single judgment standard for all investors,and does not consider the different roles of different investors entering the market and play different roles in the market.The practice of‘discriminating' is not logical.At this point,the special rules for shareholding disclosure in the United States and Japan have certain reference value for China's existing system design.The advantage of choosing a single disclosure standard lies in the convenience of practical application,and there is no difficulty in judging whether there is a change of control intention,nor is there any need for more system design to protect the special rules of the exemption from abasement.As far as the current market situation in China is concerned,institutional investors have always assumed relatively strict disclosure obligations.Whether special pressure should be adopted to alleviate this pressure is also a key issue that should be considered in the process of perfecting the legal system.Furthermore,China's current legislation has obvious defects in the legal consequences of breach of the obligation to block holder disclosure.There is no connection between the relevant laws and regulations.The ambiguity of the legal provisions is even the offside of the upper law.The current regulatory requirements in terms of punishment cannot be achieved.The legal system is always looking for a balance point.When the rights and obligations pointed out by a legal system cannot balance the rights and interests by themselves,they will have a tendency to protect the interests of one party in a way that ‘helps each other' in order to achieve the goal of rebalancing again.The same is true of the market.On the occasion of the gradual revision and improvement of the securities law,the Shanghai Stock Exchange drafted and completed the "Guidelines" and publicly solicited opinions from the market.It intends to reduce the information disclosure interval obligations of block holder changes,and the disclosure of the obligation points as the largest shareholding disclosure system.An intuitive sign,in the past two decades since the system was created,its fluctuations reflect the trade-off between market efficiency and market equity.Combining the analysis of the problems existing in the existing system and the basic concepts of the improvement of the basic system,as far as the current legislation is concerned,the author tries to make recommendations on the specific design from the following aspects: First,the cancellation of the slow-moving rules.Compared with the previous practice of reducing the disclosure obligation and extending the time to suspend trading,the legislative choice to cancel the slow-moving rule is more in line with market demand and legal logic.Second,the introduction of the control intention inference mechanism follows the increase in system design for shareholding purposes.The logical idea of distinguishing between simple and detailed equity change reports.Third,clarify the form of responsibility and level of responsibility and further strengthen the accountability for violations.First,it is necessary to clarify the form of administrative responsibility and increase the penalty standards for breach of disclosure obligations.Secondly,improve the relevant legal provisions on voting rights restrictions and the criminal prosecution standards for information disclosure violations.