Source: China Economic Net
China Economic Net Beijing July 27th News Yesterday, the "Administrative Penalty Decision on the Case of "Debang Shares" ([2022] No. 3) released by the website of the Shanxi Regulatory Bureau of the China Securities Regulatory Commission showed that Huang Xiao, the then head of the brand communication department of Debang Logistics Co., Ltd. (hereinafter referred to as " Debang Shares ", 603056.SH), was punished by the Shanxi Regulatory Bureau of the China Securities Regulatory Commission for insider trading the company's stocks.
It was found that in order to help the company's development, Debang Co., Ltd. launched a plan to introduce strategic investment through private placement, and on March 3, 2020, signed an confidentiality agreement with Alibaba (China) Network Technology Co., Ltd. . On April 2, 2020, Debang Co., Ltd. signed a confidentiality agreement with Yunda Holdings Co., Ltd. , and officially began due diligence adjustment; after that, Debang Co., Ltd. MD, secretary of the board of directors Miao, started negotiations with Alibaba and other companies, and finally chose to cooperate with Yunda Co., Ltd. MD, and Fu, secretary of the board of directors of Yunda Co., Ltd., to determine the investment plan framework and notify securities companies and lawyers to enter the market simultaneously.
On May 23, 2020, Debang Co., Ltd. held a board meeting to review and approve matters related to the private placement. Debang Co., Ltd. and Yunda Co., Ltd., a wholly-owned subsidiary of Ningbo Meishan Free Trade Zone Fushan Investment Co., Ltd. signed a subscription agreement for the private placement of A shares and a strategic cooperation agreement for . Fushan Investment agreed to subscribe to the A-share shares of Debang Co., Ltd. in this private placement in accordance with the conditions, prices and quantity stipulated in Yunda Co., Ltd. After the market closed on May 24, 2020, Debang Co., Ltd. disclosed relevant announcements.
In summary, the China Securities Regulatory Commission determined that the matters of Debang Co., Ltd.'s private placement of A-shares belong to the matters listed in Article 80, Paragraph 2, Item 9 of the " Securities Law ", and according to the provisions of Article 52, Paragraph 2 of the "Securities Law", it is insider information before the announcement. The insider information was formed no later than March 3, 2020 and was released after the market was closed on May 24, 2020. As the chairman of Debang Co., Ltd. and Miao, as the secretary of the board of directors of Debang Co., Ltd., participated in the planning, implementation and promotion of the matter. They are all insiders who are insiders stipulated in Article 51, item 1 of the Securities Law, and are informed of it no later than March 3, 2020.
In addition, from December 2019 to March 2020, in order to retain talents and mobilize employees' enthusiasm through increasing incentive measures, Miao and others began to study incentive tools, policies, regulations and market cases. During this period, Chairman Cui Mouxing mentioned the employee stock ownership plan at the company's breakfast meeting, and the person Huang Xiao attended the breakfast meeting. On May 18, 2020, the 15th meeting of the fourth board of directors of Debang Co., Ltd. reviewed and passed the second employee stock ownership plan, and finally determined that the number of incentives was 31, and all directors, supervisors, Miao and others participated in the meeting.
After the market closed on May 18, 2020, Debang Co., Ltd. disclosed the "Second Phase Employee Stock Ownership Plan (Draft)" and its summary.
In summary, the China Securities Regulatory Commission determined that the implementation of the second phase of the employee stock ownership plan of Debang Co., Ltd. is a major matter stipulated in Article 30, Paragraph 2, Item 13 of the ", Paragraph 12 and Paragraph 52, Paragraph 2 of the ", Paragraph 12 of the Information Disclosure Management Measures for Listed Companies" revised in 2007. It is insider information before disclosure in accordance with the provisions of Article 80, Paragraph 12 of the Securities Law. The formation of this insider information is no later than March 26, 2020 and will be released after the market is closed on May 18, 2020. Huang Xiao was the head of the company's brand communication department at the time. He learned at the company's breakfast meeting that the company carried out equity incentives through the second phase of the employee stock ownership plan. It was an insider in the information stipulated in Article 51, item 4 of the Securities Law. The time for knowledge was not later than April 30, 2020.
Huang Xiao joined Debang Co., Ltd. in 2007. From 2018 to September 2020, he served as the head of the brand communication department of Debang Co., Ltd., managing five departments including the brand management department, design department, online marketing department, offline marketing department and public relations department. He is the middle-level manager of the company and is directly under the management of the chairman Cui Mouxing. He goes to Cui Mouxing's office to report his work every two weeks. During the sensitive period of insider information 1, Huang Xiao directly reported his work to insider Cui Mouxing, an insider. He had a call with insider Miao Mou before buying "Debang Shares", which was convenient for obtaining insider information.In addition, Huang Xiao is an insider of Insider Information 2 and is aware of the company's equity incentives through the second phase of the employee stock ownership plan.
Huang Xiao’s securities account is used by himself. During the sensitive period of insider information, the account transferred a total of 1.18 million yuan, of which 700,000 yuan came from the loan he intended to use for decoration to Guangzhou Xingguang Microfinance Co., Ltd.; 480,000 yuan came from the performance bonus issued by Debang Co., Ltd. in 2019. During the sensitive period of insider information, Huang Xiao used his account to buy a total of 111,100 shares of "Debang Shares" with a transaction amount of 1.179,800 yuan. After the insider information was released to August 17, all the stocks involved in the case were sold in the account and a profit of 453,900 yuan was made.
The CSRC believes that Huang Xiao's behavior violated the provisions of Article 50 and Article 53, paragraph 1 of the Securities Law and constituted the act described in Article 191, paragraph 1 of the Securities Law. According to the facts, nature, circumstances and degree of social harm of the parties' illegal behavior, and in accordance with the provisions of Article 191, Paragraph 1 of the Securities Law, the Shanxi Regulatory Bureau of the China Securities Regulatory Commission decided to confiscate Huang Xiao's illegal income of 453,900 yuan and impose a fine of 1 million yuan.
After queries by China Economic Network reporters, Debang Co., Ltd. was listed on on Shanghai Stock Exchange on January 16, 2018. As of March 31, 2022, Ningbo Meishan Bonded Port Debang Investment Holding Co., Ltd. was the largest shareholder, and holds 3.683 billion shares of html, with a shareholding ratio of 66.5%.
Debang Co., Ltd. disclosed the "Announcement on Changes in the Equity Structure of the Controlling Shareholder and Changes in the Actual Controller" on March 12, 2022. The company received a notice from the actual controller Mr. Cui Weixing , the controlling shareholder Ningbo Meishan Bonded Port Debang Investment Holding Co., Ltd., and Suqian JD Zhuofeng Enterprise Management Co., Ltd. that Cui Weixing and his joint actor Xue Xia, through Debang Holdings, indirectly held the company's shares, and Debang Holdings, a total of 153 natural persons and institutional shareholders, except for the aforementioned founding shareholders, directors, supervisors, senior management, and Debang Holdings, signed share transfer agreements and other transaction documents with JD Zhuofeng. The transferee will acquire a total of 93.8625 million shares of the target company held by the founding shareholders, directors, supervisors, senior management, and small shareholder transferors, accounting for 99.9870% of the total share capital of the target company. If this transaction is successfully implemented, JD Zhuofeng will indirectly control 66.4965% of the company's shares held by the target company; the actual controller of the company will change, Cui Weixing will no longer be the actual controller of the company, the target company will still be the company's controlling shareholder, and JD Zhuofeng, controlled by JD Group, will become the company's indirect controlling shareholder.
Debang Co., Ltd. disclosed the "2020 Private Issuance A Shares Plan" on the evening of May 23, 2020. The issuance target of this private placement is Fushan Investment, with a total of 1 specific object, and the number of issuances shall not exceed 30% of the company's total share capital before this private placement, that is, no more than 288 million shares (including the number of shares). The total amount of funds raised in this private placement shall not exceed RMB 614 million (including the number of the original amount). After deducting the relevant issuance fees, the funds raised in this private placement are intended to be used for the transfer center intelligent equipment upgrade project and the IT information system construction project respectively.
On February 2, 2021, Debang Co., Ltd. disclosed the "Announcement on the Application for Private Issuance of Stocks Being Reviewed and Approved by the China Securities Regulatory Commission's Issuance Review Committee."
On the evening of April 22, 2021, Debang Co., Ltd. disclosed the "Report on the Issuance of A-shares in 2020". There is a total of 1 target for this private placement, which is Yunda Co., Ltd. The sponsor (lead underwriter) is CITIC Securities Co., Ltd., and the sponsor representatives of are Kong Shaofeng and Yang Yanjun. According to the " Capital Verification Report " issued by Rongcheng (Rongcheng Verification Number [2021] 216Z0009), as of March 26, 2021, Debang Co., Ltd. has issued 66.95747 million shares to Yunda Holdings Co., Ltd., with a total amount of funds raised by RMB 614 million. After deducting the issuance fee of RMB 10.215 million, the actual net funds raised by the company was RMB 604 million, of which RMB 66.9575 million was included in the share capital and RMB 537 million was included in the capital reserve . After raising funds through this private placement of shares, the registered capital of Debang Shares was changed to RMB 1.027 billion and the share capital was RMB 1.027 billion.
On the evening of May 18, 2020, Debang Co., Ltd. disclosed the "Second Phase Employee Stock Ownership Plan (Draft)". The participants of this plan are directors (excluding independent directors), senior management and core management personnel that have an important role and impact on the company's overall performance and medium- and long-term development, with a total of 31 people. The source of shares in this plan is the company's A-share common shares repurchased by the company's special account, with a total of no more than 7.1333 million shares, accounting for 0.74% of the company's total share capital as of December 31, 2019.
Article 80 of the Securities Law stipulates that a major event that may have a significant impact on the stock trading prices of listed companies and companies that trade in other national securities trading venues approved by the State Council. When investors have not yet learned about it, the company shall immediately submit an interim report on the situation of the major event to the securities regulatory authority of the State Council and the securities trading venues, and announce it to explain the cause, current status and possible legal consequences of the incident.
The major events referred to in the preceding paragraph include:
(I) Major changes in the company's business policy and scope;
(II) Major investment behavior of the company, in which the company purchases or sells major assets within one year exceeds 30% of the total assets of the company, or the company uses the mortgage, pledge, sells or scraps of its main assets once, and more than 30% of the assets;
(II) The company enters into an important contract , provide a major guarantee or engage in related transactions, which may have an important impact on the company's assets, liabilities, equity and operating results;
(IV) The default of the company's major debts and failure to repay the due major debts;
(V) The company's major losses or major losses;
(V) The company's major changes in the external conditions of the company's production and operation;
(V) The company's directors, one-third of the company's directors, The situation of shareholders or actual controllers holding more than 5% of the company's shares or controlling the company has changed significantly, and the situation of the actual controller of the company and other companies that control the same or similar businesses as the company has changed greatly;
(9) The plan of the company's dividends and capital increase, important changes in the company's equity structure, the company's capital reduction, merger, division, dissolution and The decision to file for bankruptcy, or enter bankruptcy procedures in accordance with the law, and is ordered to close;
(10) Major litigation or arbitration involving the company, the resolutions of the general meeting of shareholders and board of directors are revoked or declared invalid in accordance with the law;
(11) The company is suspected of committing a crime and is investigated in accordance with the law, and the company's controlling shareholder, actual controller, directors, supervisors, and senior management personnel are suspected of committing a crime and are compulsory measures taken in accordance with the law;
(12) Other matters stipulated by the securities regulatory authority of the State Council.
If the controlling shareholder or actual controller of the company has a significant impact on the occurrence and progress of major events, he shall promptly inform the company of the relevant information he is aware of in writing and cooperate with the company to fulfill its information disclosure obligations.
Article 52 of the Securities Law stipulates that in securities trading activities, undisclosed information involving the issuer's operation, finance, or a significant impact on the market price of the issuer's securities is insider information. Major events listed in Article 80, Paragraph 2 and Paragraph 81, Paragraph 2 of this Law are insider information.
Article 51 of the Securities Law stipulates that the insider of securities transactions include:
(I) the issuer and its directors, supervisors, and senior management personnel;
(II) the shareholders who hold more than 5% of the company's shares and their directors, supervisors, and senior management personnel, the actual controllers of the company and their directors, supervisors, and senior management personnel;
(III) the issuer holding or the actual controlled company and its directors, supervisors, and senior management personnel;
(IV) the acquirer of the listed company or the party with major asset trading;
(V) the acquirer of the listed company or the party with major asset trading;
(IV) the acquirer of the listed company or the party with major asset trading; Its controlling shareholder, actual controller, director, supervisor and senior management personnel;
(VI) Relevant personnel of securities trading venues, securities companies, securities registration and settlement institutions, and securities service institutions that can obtain insider information due to their positions and work;
(VIII) Staff of relevant competent departments and regulatory agencies that can obtain insider information due to their duties and work;
(VIII) Staff of relevant competent departments and regulatory agencies that can obtain insider information due to their statutory duties;
(VIII) Staff of relevant competent departments and regulatory agencies that can obtain insider information as stipulated by the securities regulatory agency of the State Council.
Article 50 of the Securities Law stipulates that insiders of securities trading and those who illegally obtain insider information are prohibited from using insider information to engage in securities trading activities.
Article 53 of the Securities Law stipulates that insiders of securities transactions and those who illegally obtain insider information shall not buy or sell the company's securities, or disclose the information, or suggest that others buy or sell the securities before the insider information is disclosed. If this Law provides otherwise, the provisions shall apply to natural persons, legal persons, and non-legal person organizations, , who hold or jointly hold more than 5% of the company's shares with others through agreements or other arrangements to acquire shares of listed companies. If insider trading causes losses to investors, they shall bear compensation liability in accordance with the law.
Article 191 of the Securities Law stipulates that if an insider of insider information in securities transactions or a person who illegally obtains insider information engages in insider trading in violation of the provisions of Article 53 of this Law, he shall be ordered to deal with the illegally held securities in accordance with the law, confiscate the illegal gains, and impose a fine of not more than one times but not more than ten times the illegal gains; if there is no illegal gains or the illegal gains are less than 500,000 yuan, he shall be fined not less than 500,000 yuan and not more than 5 million yuan. If an organization engages in insider trading, it shall also give a warning to the directly responsible supervisor and other directly responsible persons and impose a fine of not less than RMB 200,000 and not more than RMB 2 million. Staff members of the securities regulatory agency of the State Council shall be punished more severely if they engage in insider trading. Those who violate the provisions of Article 54 of this Law and use undisclosed information to conduct transactions shall be punished in accordance with the provisions of the preceding paragraph.
The following is the original text:
Huang Xiao’s insider trading “Debang Shares” case administrative penalty decision
〔2022〕3
Party: Huang Xiao, female, born in August 1985, address: Tianhe District, Guangzhou City, Guangdong Province.
In accordance with the relevant provisions of the " Securities Law of the People's Republic of China " (hereinafter referred to as the "Securities Law"), our bureau has filed an investigation and trial on Huang Xiao's insider trading of the shares of Debang Logistics Co., Ltd. (hereinafter referred to as Debang Shares), and informed the parties of the facts, reasons, basis for administrative penalty for and the rights enjoyed by the parties in accordance with the law. At the request of the party Huang Xiao, our bureau held a hearing on July 5, 2022 and listened to Huang Xiao's statements and defenses. The investigation and trial of this case have now ended.
It was found that Huang Xiao had the following illegal facts:
1. The formation and disclosure process of insider information
(I) Insider information 1: Matters of the private placement of A-shares in Debang Shares
In order to help the company develop, reduce costs and increase efficiency, and improve market competitiveness and share, Debang Shares launched a plan to introduce strategic investment through private placement, and continue to find strategic investment negotiation objects.
On March 3, 2020, Alibaba (China) Network Technology Co., Ltd. (hereinafter referred to as Alibaba) and Debang Shares signed a confidentiality agreement on "Alibaba or its affiliates' proposed investment in Debang Shares." Afterwards, Miao, secretary of the board of directors of Debang Co., Ltd., began to connect with Alibaba and provide due diligence information to him.
On March 25, 2020, Cui Mouxing, chairman of Debang Co., Ltd., was invited to meet Nie Mouyun, chairman of Yunda Holdings Co., Ltd. (hereinafter referred to as Yunda Co., Ltd.). On March 27, Fu, secretary of the board of directors of Yunda Co., Ltd., visited and held preliminary consultations with Miao. On April 2, Fu and Miao signed a confidentiality agreement and officially began due diligence.
From April to May 2020, Debang Co., Ltd. provided due diligence information to Yunda Co., Ltd. and explained the data caliber and performance. During this period, Miao started negotiations with Alibaba and other companies at the same time, and finally chose to cooperate with Yunda Co., Ltd.
On May 15, 2020, Miao and Fu negotiated, and the two sides reached an agreement on the price, but some cooperation details and directions were not agreed.
On May 20, 2020, Miao and Fu determined the investment plan framework, such as investment subject, price, proportion, cooperation direction, etc., and notified securities companies and lawyers to enter the market simultaneously.
On May 23, 2020, Debang Co., Ltd. held the 16th meeting of the fourth board of directors to review and pass matters related to the private placement. Debang Co., Ltd. and Ningbo Meishan Bonded Zone Fushan Investment Co., Ltd. (hereinafter referred to as Fushan Investment), signed by Debang Co., Ltd. and Ningbo Meishan Bonded Zone Fushan Investment Co., Ltd. on the conditional effect of the private placement of A-shares of Debang Co., Ltd. on Debang Logistics Co., Ltd.'s private placement of A-shares of Debang Co., Ltd. signed by Ningbo Meishan Bonded Zone Fushan Investment Co., Ltd. (hereinafter referred to as Fushan Investment), a wholly-owned subsidiary of Yunda Co., Ltd., Ningbo Meishan Bonded Zone Fushan Investment Co., Ltd. on the conditional effect of Debang Logistics Co., Ltd.'s private placement of A- The Subscription Agreement (hereinafter referred to as the "Share Subscription Agreement with Conditions Effective"), and the "Strategic Cooperation Agreement between Debang Logistics Co., Ltd., Yunda Holdings Co., Ltd. and Ningbo Meishan Bonded Zone Fushan Investment Co., Ltd." (hereinafter referred to as the "Cooperation Agreement") signed with Yunda Shares and Fushan Investment Co., Ltd. (hereinafter referred to as the "Cooperation Agreement") agreed: Fushan Investment agreed to subscribe to the A-share shares of Debang Shares in this private placement in accordance with the conditions, prices and quantity stipulated in the Yunda Shares decision and the relevant subscription agreement.
After the market closed on May 24, 2020, Debang Co., Ltd. disclosed the "Announcement on the Introduction of Strategic Investors and Signing of Strategic Cooperation Agreements" and "Announcement on the Signing of Conditional Share Subscription Agreements and Related Transactions with Specific Objects".
In summary, the matters listed in the private placement of A-shares in Debang Shares belong to Article 80, Paragraph 2, Item 9 of the Securities Law "The company's plan to allocate dividends and increase capital, important changes in the company's equity structure, the company's decision to reduce capital, merger, division, dissolution and apply for bankruptcy, or entering bankruptcy procedures in accordance with the law and being ordered to close down" are in the matters listed in Article 52, Paragraph 2 of the Securities Law, which are insider information before the announcement. The insider information was formed no later than March 3, 2020 and was released after the market was closed on May 24, 2020. As the chairman of Debang Co., Ltd. and Miao, as the secretary of the board of directors of Debang Co., Ltd., participated in the planning, implementation and promotion of the matter. They are all insiders who are insiders stipulated in Article 51, item 1 of the Securities Law, and are informed of it no later than March 3, 2020.
(II) Insider information 2: Debang Co., Ltd.'s second phase employee stock ownership plan matters
Debang Co., Ltd. plans to retain talents and mobilize employees' enthusiasm by increasing incentive measures. From December 2019 to March 2020, Miao and others began to study incentive tools, policies, regulations and market cases.
In early March 2020, Miao proposed the direction of implementing incentives through the employee stock ownership plan and reported it to Cui Mouxing. Cui Mouxing just wanted to motivate the company's four senior vice presidents at the time.
On March 26, 2020, Debang Co., Ltd. and Towers Huiyue Consulting (Shanghai) Co., Ltd. (hereinafter referred to as Towers Huiyue) signed a "Consultation Service Contract". Towers Huiyue began to design an incentive plan, mainly targeting how the company's four senior vice presidents can achieve the effect of "partners".
From April 17 to May 11, 2020, Debang Co., Ltd. continued to communicate with Shanghai Stock Exchange (hereinafter referred to as the Exchange) on the second phase of the employee stock ownership plan.
In late April 2020, Cui Mouxing mentioned the employee stock ownership plan at the company's breakfast meeting. The main content was that the employee stock ownership plan planned to incentivize 4 senior vice presidents and the exchange denied the four-person stock ownership plan, but the company was still continuing to communicate, and Huang Xiao attended the breakfast meeting.
From May 9 to 10, 2020, Debang Co., Ltd. discussed internally the methods and distribution logic of expanding the scope of incentives, forming the first draft of the second draft plan, and expanding the number of people to 30.
On May 12, 2020, Cui Mouxing mentioned at the company's breakfast meeting that the employee stock ownership plan originally planned to incentivize 4 people, but the exchange did not agree with the plan and may expand the scope of incentives in the future. However, the final plan shall be based on the plan that reached an agreement with the exchange, and Huang Xiao attended the breakfast meeting.
On May 18, 2020, the 15th meeting of the fourth board of directors of Debang Co., Ltd. reviewed and passed the second employee stock ownership plan, and finally determined that the number of incentives was 31, and all directors, supervisors, Miao and others participated in the meeting.
In summary, the implementation of the second phase of the employee stock ownership plan of Debang Co., Ltd. is a major matter stipulated in Article 30, Paragraph 2, Item 13 of the "Regulations on Information Disclosure of Listed Companies" revised in 2007, "The Board of Directors Form Related Resolutions on Issuance of New Shares or Other Refinancing Plans and Equity Incentive Plans" and Article 52, Paragraph 2, Item 12 of the Securities Law, Item 12, Item 12 of the Securities Law, Item 12, Item 12 of the Securities Law, Item 52, Item 2, Item 2, Item 52, Item 2 is insider information before it is disclosed. The formation of this insider information is no later than March 26, 2020 and will be released after the market is closed on May 18, 2020. Huang Xiao was the head of the company's brand communication department at the time. He learned at the company's breakfast meeting that the company carried out equity incentives through the second phase of the employee stock ownership plan. It was an insider in the information stipulated in Article 51, item 4 of the Securities Law. The time for knowledge was not later than April 30, 2020.
2. Huang Xiao’s insider trading “Debang Shares”
(I) Huang Xiao contacted and learned insider information
Huang Xiao joined Debang Shares in 2007. From 2018 to September 2020, he served as the head of the brand communication department of Debang Shares, managing five departments including the brand management department, design department, online marketing department, offline marketing department and public relations department. He is the middle-level manager of the company and is directly under the management of the chairman Cui Mouxing. He goes to Cui Mouxing’s office to report his work every two weeks. During the sensitive period of insider information 1, Huang Xiao directly reported his work to insider Cui Mouxing, an insider. He had a call with insider Miao Mou before buying "Debang Shares", which was convenient for obtaining insider information.
Huang Xiao is an insider of Insider Information 2 and is aware of the company's equity incentives through the second phase of the employee stock ownership plan.
(II) Basic information of the account and transfer of funds
"Huang Xiao" account was opened at the Shanghai Huqingping Highway Securities Branch of China Merchants Securities on April 17, 2015 and is used by myself. During the sensitive period of insider information, a total of 1.18 million yuan was transferred to the "Huang Xiao" account, of which 700,000 yuan came from the loan it planned to use for decoration to Guangzhou Xingguang Microfinance Co., Ltd.; 480,000 yuan came from the performance bonus issued by Debang Co., Ltd. in 2019.
(III) The transaction of "Debang Shares" in the account involved
Insider information During the sensitive period, Huang Xiao used his account to place an order through his mobile phone number with the last number of 9885, and bought a total of 111,100.00 shares of "Debang Shares" with a transaction amount of 1,179,752.00 yuan. After the insider information was released to August 17, all the stocks involved in the case were sold in the account and a profit of 453,898.34 yuan was made.
(IV) Transaction characteristics of the account involved in the case
During the sensitive period of insider information 1 and insider information 2, the "Huang Xiao" account has a large amount of funds transferred. The time of funds transfer is consistent with the time of insider information formation. The funds come from the 700,000 yuan loan and 480,000 yuan year-end bonus that Huang Xiao intends to use for decoration. The funds are fully purchased on the same day or the next day when the funds are transferred, and they have a strong desire to buy. The proportion of buying and holdings at the end of the period is 100%, and the insider information is sold as soon as it is made public.During the sensitive period of insider information, Huang Xiao had contact with Cui Mouxing, an insider of insider information, and on May 1, 2020, he had a call with Miao Mou, an insider of insider information, and bought "Debang Shares" on the third trading day after that. On May 11, he contacted Miao Mou via WeChat and appeared in the chat history " Yunda ". On the second trading day after that, he bought "Debang Shares".
(V) The parties' explanation of trading motivation
In the investigation, Huang Xiao said that in 2015 and 2018, the company was managed by Cui Mougang in 2019. He did not agree with Cui Mougang's management method, so he did not buy the company's stocks in 2019. I bought the company's stocks in large quantities in 2020 because the stock price was already very low at that time, and the company made many measures in 2020 to gather people's hearts and trust the company's development, so I bought it.
In summary, Huang Xiao had contact with the insider of insider information 1 in this case, and had the convenience of obtaining insider information. At the same time, Huang Xiao was also an insider of insider information 2. Huang Xiao used his account to buy "Debang Shares" in a concentrated manner, and his willingness to buy was strong. His securities trading activities were highly consistent with insider information, and his trading behavior was obviously abnormal, and there was no legitimate reason or source of the information.
or above facts, such as evidence, relevant securities account information, bank account information, relevant company announcements and situation statements, inquiry records, communication records and other evidences, etc.
Huang Xiao's behavior violated the provisions of Article 50 and Article 53, paragraph 1 of the Securities Law and constituted the act described in Article 191, paragraph 1 of the Securities Law.
The defense reasons proposed by the party Huang Xiao were mainly: First, Cui Mouxing did not tell me and could not tell me about Yunda. I contacted Miao Mou and just asked about the reason for the rise in Yunda shares' stock price, which was to understand the normal communication between other companies in the logistics industry. I don’t know about the private placement of Debang Co., Ltd. Second, many people in the company know that Debang Co., Ltd. has launched the second phase of employee stock ownership plan to provide equity incentives, which is not insider information. Regarding this matter, I only care whether the incentive target is me. The time when I buy Debang shares is also before the incentive plan of the employee stock ownership plan is adjusted. The third is that I bought Debang shares because I understand the logistics industry, am optimistic about Debang shares, and based on Debang shares' good performance. After Cui Mouxing returned to the company, everyone in the company was optimistic about the company and believed that they could buy the company's stocks at this time. Fourth, I bought Debang shares for a long time before, and when I bought Debang shares in 2018, I held them until the final loss. Moreover, I entered the stock market when I had funds. After the loan was received, because the decoration was paid in installments, I put the idle money into the stock market. The transaction was sold in the short term, mainly because I urgently needed money, and it had nothing to do with insider information. In summary, Huang Xiao requested exemption from punishment.
Our bureau believes that, first, the parties have contact with Cui Mouxing, the insider of insider information 1 of this case, during the sensitive period, and have a call with Miao Mou, the insider of insider information 1 of this case, during the sensitive period, and have a convenient way to obtain insider information 1. The securities trading activities involved in the case are highly consistent with the insider information, and the parties cannot make reasonable explanations or provide evidence to exclude insider trading. Our bureau has sufficient factual and legal basis to determine that it constitutes insider trading. Second, equity incentive matters is insider information stipulated in the Securities Law and the Information Disclosure Management Measures for Listed Companies. As the head of the company's brand communication department, the party involved learned about the company's equity incentives through the employee stock ownership plan through attending the company's breakfast meeting, and the party himself admitted that he was aware of the matter, which belongs to the insider information provided for in Article 51, item 4 of the Securities Law. Although the first purchase of the party was before the expansion of the incentive scope, insider information had been formed at this time. According to the provisions of Article 53, paragraph 1 of the Securities Law, the parties shall not buy or sell the stock before the disclosure of insider information. Third, the parties’ defense of understanding the industry, optimizing the company, etc. is not enough to reasonably explain their obviously abnormal trading behavior. Fourth, the transaction behavior of the account involved in the case is obviously abnormal.The account involved in the case has a large amount of funds transferred in the sensitive period of insider information. The time of funds transfer is consistent with the time of insider information formation. The funds transfer is in full on the same day or the next day. The willingness to buy is strong. The proportion of buying and holdings in the sensitive period of insider information is 100%, which is consistent with the contact point of insider information contact persons. The insider information is sold after it is disclosed. The parties themselves admit that this transaction is different from the previous trading habits. The reasons for the parties to have idle funds and urgently need money are not enough to rule out the abnormality of the above transaction behavior. Fifth, in this case, there is no situation where the penalty is not imposed as stipulated in Article 33 of the Administrative Penalty Law revised in 2021, our bureau’s measurement of punishment is appropriate. In summary, our bureau will not adopt Huang Xiao’s opinions.
Based on the facts, nature, circumstances and degree of social harm of the parties' illegal behavior, and in accordance with the provisions of Article 191, paragraph 1 of the Securities Law, our bureau decided:
confiscate Huang Xiao's illegal income of 453,898.34 yuan and impose a fine of 1,000,000 yuan.
The above-mentioned parties shall transfer the fine to China Securities Regulatory Commission within 15 days from the date of receipt of this penalty decision. The bank opens the account: CITIC Bank Beijing Branch Business Department, account number: 7111010189800000162, and the bank will directly hand over to the state treasury, and a copy of the payment voucher with the name of the party is sent to the Office of the Administrative Penalty Committee of the China Securities Regulatory Commission and our bureau for filing. If the parties are dissatisfied with this penalty decision, they may apply to the China Securities Regulatory Commission for administrative reconsideration to the China Securities Regulatory Commission within 60 days from the date of receipt of this penalty decision, or they may file an administrative lawsuit with the competent people's court within 6 months from the date of receipt of this penalty decision. During the reconsideration and litigation period, the above decision will not be suspended.
China Securities Regulatory Commission Shanxi Regulatory Bureau
July 20, 2022
