The Research On The Securities Support Litigation Of China Securities Investor Services Center

How to deal with securities disputes over many investors has always been a difficult problem that nations need to study and practice in securities law.With the announcement of the new “Securities Law”,the securities support litigation actively recommended by the China Securities Investor Services Center(hereinafter referredto as the “the Investor Service Center”)has become a legal litigation system in China to settle securities disputes over many investors Since the emission of the first securities support lawsuit by the Investor Service Center in 2016,courts across the country have accepted 19 securities support lawsuits,5 of which have been finished and have help a lot of investors successfully,but in the common running,Investor Service Center also encountered problems such as insufficient legal basis,the uncertainty of the support level of the Investor Service Center,and the insufficient effectiveness of the judgment model.It is urgent to construct corresponding rules for securities support litigation and clarify the rights and obligations of various entities in securities support litigation.To build a smooth litigation mechanism,it should proceed from the characteristics of securities civil litigation.Modern securities civil disputes usually have more than one Plaintiff,and the “small amount but numerous cases” is the status of most securities disputes.Since the power of single investor is limited,it is difficult to compete with listed companies on an equal basis.Therefore,securities litigations in many countries around the world are collective,and investors are brought together to compete with defendants which mostly are listed companies.However,common investors in China are not enthusiastic about safeguarding their rights and interests through litigation,which requires the Investor Service Center to play a more active role in securities support litigation.In addition,securities civil litigations are professional,which requires the Investor Service Center and the court to play a professional advantage in the process of the case to protect small and medium investors who are relatively vulnerable in the lawsuit.In order to understand the shortcomings of the existing securities support litigation,this paper analyzes the securities support litigation that has been conducted or is underway by the Investor Service Center.At the same time,it compares similar group securities litigation systems in other countries and regions.The class action system in the United States relies on the “Option out” and the system of contingent fee to build a securities class action mainly conducted by lawyers.However,these two systems have difficulties in applying in China.Group lawsuits in Germany is lawsuit that mainly asks losing party to do definite actions and cannot be used for compensation,so it can not applicable to China's securities support lawsuits.However,The German test action appeared in recent years give the corresponding judicial power to the important facts of similar cases.This method is very suitable for group lawsuits.Securities support lawsuits can absorb this method and appropriately expand the judgment effectiveness to address the shortcomings of insufficient effectiveness of securities support litigation.In addition,based on the development of German group litigation,in Taiwan,it has set up a special investor protection center under the “Investor Protection Law” to initiate a group lawsuit for investors,which has a similar function as the Investor Service Center and can be used as a model for investor services center.From the perspective of supplementing and improving the existing securities support litigation,the author believes that the Investor Service Center should still be the initiator of the corresponding securities support litigation,and at the same time,it can collect the investors who have received damage from the country through the court or the securities registration agency in order to cover all investors,but also allows investors to sue for themselves in a reasonable way without participating in support lawsuits.In order to ensure the professionalism and efficiency of the trial of cases,the securities support litigation can be under the exclusive jurisdiction of the Shanghai Financial Court.Meanwhile,in order to ensure the stability of securities support litigation,an independent litigation fund can be established,and the Investor Service Center shall have more diversified cooperation with public welfare lawyers hired to jointly participate in securities support litigation.The Investor Service Center can act as a mediator of securities disputes according to law,so the Investor Service Center with related experience can try to have reconciliation with the relevant defendant in the securities support litigation on behalf of the investor.Finally,the Investor Service Center,as a non-profit organization,should strengthen self-monitoring and disclose information to the public in a timely manner.