On The Implementation And Perfection Of The Securities Group Litigation System With Exit Mechanism In China

During the past few decades,great revolutions have happened in securities market of China.There was enormous expanding in the quantity of increasing clients and the scope of the capital market,after the landmark,which is the issue and enforcement of the 1998 Securities Law.Healthy and reasonable competition system is necessary for the sustainable growth of the capital market.However,illegal securities manipulation is common in the real world,which interfere the normal operation of securities market and impair the market participators’ legal rights and interests.The situation is even worse in the small and medium-sized market participators.When investors suffer losses caused by illegal acts,especially financial fraud,it is not only the voice of investors but also the research and discussion of many scholars to add securities group litigation which has strong deterrence to the infringers in the securities market.In this context,China’s securities law modified in 2019,the third paragraph of article 95 has devised a clever "the Chinese version of the securities class action",take the insured institutions do not need to all investors entrust to direct the practice of registration on their behalf,realized the "implied to express out" effect,in fact established the exit securities class action system of our country.With the help of China’s efficient securities registration and settlement system,the withdrawal system solves the problem that the number of plaintiffs is small,which has been one of the pain points in China’s securities civil litigation.This leaves far-reaching repercussion on it.It is of great meaning to broaden the range of investor protection and increase the effectiveness of law.However,although China has established the withdrawal system of securities group litigation through legislation.In the way,the problems of lacking of litigation in the field of withdrawal system can the handled.Besides,a list of judicial interpretations let the framework much more clear and understandable.While as a new system,it is bound to have some defects in the design.For example,is there no restriction on the exercise of opt-out system or even the second opt-out system? Is it reasonable for an exit notice to be in the form of a public notice only? In a word,considering the area of canceling of securities group litigation,the development in the defense of small and medium market participators is required to combine the existing regulations and absorb the experience of other countries in the field of withdrawal system.Constantly improve the corresponding supporting measures,refine the corresponding supporting rules,so as to achieve the purpose of better protection of small and medium investors.There are four sections in the essay.The first section states the real crux in the process of investing.Tort liability in China,and then defines the concept and content of the withdrawal system,so that we can form a preliminary understanding of the withdrawal system.The second section elaborates the detailed process of how to use the opt-out system.In the third part,it absorbs and uses for reference the advanced theories and successful experiences of foreign opt-out system by investigating other areas that use the opt-out system.The last chapter proposes some advices on the method of constructing the withdrawal system of capital groups in China.