Legal Liability For Underweight On Violating Information Disclosure Obligations By Major Shareholders Of Listed Companies

Underweight by major shareholders of a listed company is the basis and one of the fundamentals of securities trading market,but the underweight shall comply with the relevant provisions of the Securities Law and other laws and regulations about information disclosure system.China's large-scale shareholding disclosure system is different in that,in addition to requiring disclosure at the critical point of shareholding,it also has slow-walking rules.Therefore,the "underweight on violating information disclosure obligation" described in the title of this article actually focus on subsequent transaction,not just non-disclosure.In other words,the disclosure obligation is not a concept in the usual sense,but a broad concept based on the aforementioned special characteristics of the large-stock disclosure system.Under the background of information asymmetry and short-term arbitrage psychology,major shareholders of China's listed companies as insiders of the companies,enjoy the multiple advantages of capital and internal information.Based on these advantages,underweight on violation of information disclosure obligations of major shareholders happens sometimes.For the sake of brevity and convenience,the following unified expression of this behavior is "Illegal underweight".Since 2015,regulatory authorities and stock exchanges have repeatedlypromulgated regulatory documents and implementing rules for the underweight behavior,triggering hot discussions frequently.It is beyond reproach that the underweight by shareholders is their own right,but the imperfection of legal regulations and the ineffective imposition of punishment have encouraged the arrogance of illegal underweight,damaged the interests of small and medium investors,and at the same time caused the stock market turmoil and damaged the securities market environment.Therefore,it is necessary to regulate the illegal underweight by major shareholders and pay attention to the assumption of legal liability.In the existing legal norms,administrative responsibility is the responsibility that the Securities Law clearly stipulates for illegal underweight;in judicial practice,the court often involves the civil liability of the responsible subject when making judgments in such cases.Therefore,the research focus of this article is also on the administrative and civil liability of illegal underweight.Except the introduction and conclusion,the main body of the article is roughly composed as follows:The first chapter introduces the current situation and prominent problems with respect to the regulation on the underweight by major shareholders of listed companies,concludes in the written decisions of administrative penalties issued by the China Securities Regulatory Commission and the written judgments rendered by people's courts.There are inconsistencies in the determination of the nature of illegal underweight and in the assumption of administrative and civil liability respectively in practice,clearly puts forward problems,which paves the way for the analysis and resolution of problems specified below.The second chapter studies the nature of illegal underweight,which is often confused with insider trading in theory and practice.Whether the illegal underweight can fall into the regulatory scope of insider trading,or overlaps with insider trading,which means illegal underweight can be transformed should be considered.On the other hand,no matter from the form of expression,the existing legal norms or the constituent elements of the various legal elements,the illegal underweight can completely fall into the scope of inductive multi-type misrepresentation,so it can be regarded as inductive multi-type misrepresentation.Therefore there will be morereference in dealing with the subsequent civil liability.Chapter 3 discusses the administrative liability that shall be borne by major shareholders' illegal underweight,analyzes the shortcomings of existing penalties,and puts forward the improvement path.Administrative liability for illegal underweight is a way of bearing liability expressly specified in the new Securities Law.However,due to the competition and cooperation of the legal provisions,there was once a confusion in logical thinking of the punishment by the regulatory authorities.The specific manifestation was that the punishment was only based on the old "Securities Law" Article 193,which greatly reduced the deterrent effect of the punishment.At the same time,there is also a ambiguity in the way of liability.When the new "Securities Law" was amended,it mainly increased the penalties for certain securities violations,but there are still incomplete provisions on other provisions of administrative liability.So this chapter seeks to find out the path to perfect the provisions on administrative liability under the new "Securities Law" system.Firstly,the position of relevant information disclosure provisions in the new "Securities Law" should be adjusted.Secondly,it should be figured out and specified that the intention of the punishment measures of "ordering to correct" and the degree of correction.Chapter 4 seeks to improve the civil compensation liability that shall be assumed by major shareholders for their illegal underweight behavior.The fact that major shareholder infringes upon the information right of the counter-party is an infringement.It shall be first determined whether the validity of the illegal trading between the shareholder and the investor is a prerequisite for bearing civil liability.Based on the particularity of commercial transactions,it can be judged that even if the previous behavior violates the legal provisions,it should not directly deny the effectiveness of the transaction results after the underweight.In addition,the courts shall,on the basis of the differences between the relevant provisions of the new Securities Law and those of the Several Provisions of the Supreme People's Court on the Trial of Cases of Civil Compensation Arising from the False Statement in Securities Market(hereinafter referred to as the Several Provisions),analyzes the imputation principles of civil compensation liability,clarifies the deficiencies in therules for the determination of causation and the calculation of the scope and amount of compensation.The general rules derived from the analysis are applied to illegal underweight,in order to make further detailed analysis.In this way,I hope to rationalize the theoretical logic of legal liability for illegal underweight by shareholders of listed companies,and better help to stabilizing development of securities market.