Research On Special Representative System Of Securities Dispute Litigation

Exploring and establishing the system of class action is the focus of the reform of the basic legal system of the securities market.The securities special representative litigation system,known as the securities class action system with Chinese characteristics,plays a role in filling the losses of investors and deterring illegal acts in the securities market.We should improve the securities special representative litigation system in terms of mode,procedure and accountability,in order to expect to realize the real implementation of the system,so as to get rid of the plight of class action characterized by small amount and large number of people in China.In addition to the introduction and conclusion,the full text is divided into four parts:The first part explains the function and concept of the securities special representative litigation system.Compared with the increasingly strong public law enforcement of securities,Chinese private securities litigation is relatively weak,and the practice of Supporting Litigation and Model Judgment can not play the expected effect.Securities special representative litigation inherits the advantages of implied participation class action and non-profit organization class action,and effectively plays the function of filling damage and deterring effect.After using the method of literal interpretation to analyze the meaning of securities special representative litigation,this paper demonstrates that securities special representative litigation is homogeneous with ordinary representative litigation in terms of legal reference and application,and heterogeneous with ordinary representative litigation in terms of the way of participating in the litigation and representative qualification.The second part analyzes the evolutions of the litigation system of securities special representative in China.Under the environment of Chinese securities market,in the process of absorbing and learning from the theory of implied participation class action and non-profit organization class action,the litigation system of special representative has three major evolutions in terms of mode,procedure and accountability.First of all,in terms of mode,the securities civil litigation led by lawyers in the past is insufficient to the market,while the special representative litigation system led by non-profit organizations avoids the problem of high agency cost and pursues the maximization of the interests of investors,which has obvious institutional advantages.Secondly,in terms of procedure,the special representative litigation procedure creates special mediation procedures,preferential litigation fee burden procedures and strict implementation procedures,which are connected with the ordinary representative litigation procedure.Finally,in the practice of accountability,the judiciary adheres to the working principle of zero tolerance,expands the identification scope of the person directly responsible,and explores the mechanism of pursuing the first evil and beating accomplices.The third part analyzes the difficulties in the implementation of the securities special representative litigation system.First,in terms of the operation of the the investor protection institution as the special representative,the responsibilities of the investor protection institution in special representative litigation are in conflict with the traditional responsibilities of Exercising Shareholders’ Rights and Supporting Litigation,and monopolizing the subject qualifications for filing special representative lawsuits is over-whelmed.And the investor protection institution is prone to fall into the dilemma of insufficient incentives and supervision.There is a conflict in the application of the progressive relationship principle in the transfer of proceedings with the ordinary representative.Secondly,in terms of procedure,there are obstacles in the application of the principle of progressive relationship between special representative litigation and ordinary representative litigation.In the special mediation procedures established based on efficiency and cost considerations,there are problems of poor connection between litigation and mediation and the absence of a fair supervision mechanism.The implementation of allocation procedures and litigation burden procedures are limited by immature legislation and can not meet the needs of practice.Finally,in the process of accountability,listed companies usually bear the main responsibility,and the relevant responsible persons transfer the responsibility through insurance,so the professional risk of independent directors is amplified.The fourth part puts forward the improvement path of the litigation system of securities special representative.On the basis of the first three parts,this part draws lessons from the mature experience of relevant countries and regions,and puts forward corresponding suggestions on the litigation system of the special representative.First,in the operation of the investor protection institution as the special representative,promote coordination between new and old responsibilities,add specialized institutions in the securities industry and non-profit social organizations to promote competition among investor protection institutions,and establish the special investor protection fund and contingent fee to solve the institution’s problems such as the lack of funds and manpower,and build a regulatory system within the institution,China Securities Regulatory Commission and courts to squeeze the vacuum of regulation.Secondly,in terms of litigation procedures for the special representative litigation,on the basis of not changing the progressive relationship with ordinary representative litigation,let the investor protection institution select cases first to strengthen the procedure switching mechanism,build a connection mechanism between litigation and mediation and a fair supervision mechanism in the mediation procedure to give full play to its special advantages,and uniformly implement the procedural rules of distribution and litigation burden to enhance the sense of gain of injured investors.Finally,in the process of accountability,we should implement the mechanism of chasing principal culprit,strengthen the accountability of relevant responsible persons,supervise the Directors and Officers Liability Insurance system to prevent them from evading their responsibilities,and reconstruct the incentive and restraint mechanism of independent directors to enhance the supervisory role of the board of director.