The draft amendment to the Standing Committee of the National People's Congress for the first instance on April 20. The revised draft
clarified the application conditions and registration procedures for stock issuance registration from the legal level for the first time, and established the legal system for stock issuance registration. In addition, the draft National Security Law submitted for second review on the 20th has added security tasks in some important areas according to the needs of safeguarding national security.
Securities Law has once again undergone large-scale and vigorous modifications after ten years. There were 338 draft amendments to the Securities Law that were submitted to the Standing Committee of the National People's Congress for review yesterday, including 122 new ones, 185 revisions, and 22 deleted. Implementing the stock issuance registration system has become the focus of this amendment. This means that since the Third Plenary Session of the 18th CPC Central Committee announced the "promoting the reform of the stock issuance registration system", the registration system, which is highly anticipated by the market, has entered the statutory procedure. The revised draft clarified the application conditions and registration procedures for stock issuance registration from the legal level for the first time, and established the legal system for stock issuance registration.
Cancel the stock issuance review system
The revised draft of the Securities Law points out that the essence of promoting the reform of the stock issuance registration system is to focus on information disclosure, and all parties involved in the market make judgments on the issuer's asset quality and investment value, clarify the registration procedures, and cancel the stock issuance review committee system.
Interpretation: The current Securities Law stipulates that the public offering of stocks shall be subject to an approval system. One of the highlights of this revision is undoubtedly the implementation of the registration system for stock issuance.
So does changing the approval system to the registration system mean that the threshold for listed companies has been lowered? Will the stock market usher in an explosive increase? In this regard, Wu Xiaoqiu, director of the Institute of Finance and Securities at Renmin University of China, said that this is mainly because of a change in the approval mechanism, and the supervision and auditing are separated, because in the past, the China Securities Regulatory Commission both supervised and reviewed, which was a problem. It is necessary to establish a system of separation of supervision and auditing. At the same time, the focus of the review was mainly on the financial statements of the company, whether it has performance or growth. Now it mainly focuses on its information transparency and whether its financial statements are true. This does not mean that the threshold for listed companies has been lowered, or that it can be listed very conveniently.
Stock issuance registration is reviewed by the exchange
The revised draft of the Securities Law points out that if the public issuance of shares and intends to be listed on the stock exchange, the stock exchange shall be responsible for reviewing the completeness, consistency and understanding of the registration documents. If the exchange issues a consent, it shall submit the registration documents and review opinions to the securities regulatory agency. If the securities regulatory agency does not raise any objection within ten days, the registration shall take effect.
Interpretation: Compared with the old Securities Law, a major change in the revised draft is to clearly delegate the IPO review authority to the exchange and place the exchange review before the China Securities Regulatory Commission registration. Dong Dengxin, director of the Institute of Finance and Securities at Wuhan University of Science and Technology, analyzed that this means handing over the IPO decision-making power to the market.
Revising the Securities Law is the prerequisite for the registration system reform. During the "Two Sessions", Xiao Gang, Chairman of the China Securities Regulatory Commission, stated that the registration system can be implemented on the day the new securities law is implemented. Wu Xiaoling, deputy chairman of the Finance and Economics Committee of the National People's Congress, previously said: "According to normal progress, the amendment to the Securities Law is expected to be held at the end of April. After the initial review, opinions and summary are needed. The second trial will be conducted as early as August and the third trial will be completed in October."
Dong Dengxin believes that the revised draft of the Securities Law has entered the review stage at this time, which is a clear signal that the registration system reform will accelerate. He said that the market has been bullish recently, and the bull market is the best time to implement the registration system reform, which may prompt the regulators to advance the timetable for implementing the registration system. "For example, the decentralization of the IPO review authority may be implemented as soon as June." Zhang Gang, chief strategy analyst of
Southwest Securities, said that if the exchange undertakes the review authority, if there is no window guidance from the CSRC, it will become inevitable to strive to become bigger and stronger, forming a situation of rapid growth in IPOs. The focus of the industry is currently on how to strengthen on-site and post-event supervision and protect small and medium-sized investors. There is still a lot of room for improvement in the current regulations, and how to implement and implement it has become a difficult point. If the control is tight, there will be no fish when the water is clear; if the control is loose, the stock market will become a big casino. A truly comprehensive reform should be the direction of corporatization of the exchange.
New cash dividend system
The revised draft of the Securities Law points out that based on the actual situation of my country's securities market, on the premise of respecting corporate autonomy, listed companies are required to clarify the specific arrangements and decision-making procedures for cash dividends in their articles of association. According to the draft, if a listed company has a surplus after making up for losses and withdrawing statutory reserve funds in the year, cash dividends shall be distributed in accordance with the provisions of the company's articles of association.
Interpretation: Inadequate cash dividends have always been a major problem in the Chinese stock market. The revised draft of the Securities Law clarifies the cash dividend system, which is conducive to protecting the interests of small and medium-sized investors. But Zhang Gang also said that according to international practice, there is currently no precedent for forced dividends, otherwise there would be no cases of Microsoft and Apple (the long-term cases of not dividends in history). Previously, Dong Dengxin, director of the Institute of Finance of Wuhan University of Science and Technology, said that whether listed companies pay dividends is still a voluntary action, and the regulators and the stock exchange have no right to directly interfere; but whether investors are good at expressing their will by "voting with their feet" is the most important sign of market maturity. Therefore, the new cash dividend system added to the draft amendment to the Securities Law is conducive to guiding small and medium-sized investors to establish a sense of cash dividends and protect their own interests.
Investors who commit fraud in listed companies can receive advance compensation
The revised draft of the Securities Law points out that if investors suffer losses due to fraudulent issuance, false statements or other major violations, the issuer's controlling shareholder, actual controller, relevant securities operating institutions, securities service institutions, and investor protection institutions recognized by the securities regulatory authority of the State Council may reach an agreement with investors on compensation matters and provide advance compensation. After advance compensation, compensation may be made to the issuer and other joint and several liable persons in accordance with the law.
Interpretation: The model of paying investors who actually suffered losses in advance can greatly reduce the time-consuming and cumbersome burden of proof and the cost of rights protection for investors to conduct false statements of civil litigation. At present, the China Securities Regulatory Commission has made useful explorations in its actual operation. On September 14, 2012, the China Securities Regulatory Commission filed an investigation into the suspected illegal and irregular acts of Wanfu Shengke (Hunan) Agricultural Development Co., Ltd. This case is the first case of a GEM company fraudulently issuing stocks. During the issuance and listing of Wanfu Shengke, three intermediary institutions, including the sponsor Ping An Securities, the audit agency Zhonglei Accounting Firm, and Hunan Boao Law Firm, and relevant responsible personnel were suspected of failing to perform their duties diligently and with false records of the relevant materials issued, they were subsequently investigated and punished.
On May 10, 2013, Ping An Securities, as the sponsor and lead underwriter of Wanfu Shengke's initial public offering and listing, invested RMB 300 million to establish the "Wanfu Shengke's False Statement Event Investor Interest Compensation Fund" and entrust China Securities Investor Protection Fund Co., Ltd. to serve as the fund manager. The special compensation fund adopts the "payment first and then pursuit" model, that is, Ping An Securities first uses the fund property to repay qualified investors, and then seeks compensation from the main responsible parties and joint and several parties for false statements by Wanfu Shengke through legal channels.
"stock speculation" for securities practitioners lifted the ban
The revised draft of the Securities Law adjusts and cancels several restrictive or prohibitive provisions, such as canceling the prohibition clauses for securities practitioners and regulatory agencies to buy and sell stocks, and establishing a securities trading declaration and registration system accordingly. Interpretation of
: In recent years, the question of whether securities practitioners can enter the market directly has been a hot topic of concern to the market. As ordinary citizens, everyone, including securities personnel, has the right to invest, and the new law intends to allow securities personnel to buy and sell stocks to return the rights to securities personnel.
Song Qinghui, a famous economist, said that assuming that the new law allows securities practitioners to buy and sell stocks to land, it will definitely be major good news for the market. In the past, securities practitioners' stock buying and selling behaviors objectively existed in an "underground" form. This time, this time, the amendment made this investment behavior sunny, and public supervision was a huge improvement compared to the past.In mature foreign markets, it is normal for practitioners to hold stocks in a compliant and legal manner. Article 43 of my country's current Securities Law stipulates that securities company practitioners are not allowed to hold stocks in compliance with the law. Song Qinghui believed that the main reason was that the capital market environment was immature at that time, and the prohibition regulations were mainly issued to protect investors. This practice was reasonable in the environment at that time. However, with the continuous improvement of the securities market mechanism and the continuous improvement of the level of regulation and integrity in the securities industry, the practice of not allowing securities company practitioners to hold stocks in accordance with the law is not in line with the actual situation of current market development.
can establish a securities partnership
The revised draft of the Securities Law is in the chapter "Securities Business Institutions", which clearly puts forward the concept of "securities partnership". The draft stipulates that if one of the securities businesses stipulated in the draft business of securities companies and securities partnerships, the minimum registered capital or capital contribution is RMB 30 million. If two or more securities businesses are engaged in, the minimum registered capital or capital contribution shall be calculated in conjunction.
Interpretation: The draft clarifies the concept of "security partnership" for the first time, which means that partnership securities companies will be allowed. Li Daxiao, chief economist of Yingda Securities, analyzed that the core asset of the securities industry is people. Through partnership, it can not only retain talents, but also create "century-old stores" like Goldman Sachs.
uses the "Unpublished Information" transaction responsibility insider trading
draft regulations, prohibiting employees of securities trading venues, securities registration and settlement institutions, securities operating institutions, securities service institutions and other financial institutions, staff of relevant regulatory departments or industry associations, and other persons who have obtained undisclosed information due to work and responsibilities, to buy or suggest others to buy or sell securities related to the information, or to disclose the undisclosed information.
Interpretation: The "unpublished information" here refers to information that has a significant impact on the market price of securities except insider information and has not yet been disclosed. If the transaction uses undisclosed information to cause losses to investors, the liability for compensation should be borne the same as insider trading.
Since the revision of the Securities Law in 2005, China Securities Law has been greatly revised and improved after 10 years! The introduction of the registration system is a major event since the establishment of the Chinese securities market, which means that the Chinese securities market will enter the path of standardized and market-oriented rapid development, which will have a significant and far-reaching impact on the securities market and constitute a major medium- and long-term benefit to venture capital incubation listed companies!
venture capital category major stocks:
1, 600783 Luxin Venture Capital, China's only pure venture capital listed company!
once set a record of 18 times increase from 2008 to 2011!
There are many venture capital incubation companies, with a cumulative investment of tens of billions!
is undoubtedly the biggest beneficiary of the long-term beneficiary of the launch of the registration system!
2, 600283 Qianjiang Water Conservancy, one of the major shareholders of Silicon Valley Paradise!
3, 600635 public utility, and the proportion of venture capital is relatively large!
4, 600210 Zijiang Enterprise, the lowest-priced venture capital stock!
5, 000917 TV Media
This post only analyzes and discusses the opportunities brought by the revision of the Securities Law and does not constitute investment advice!
Welcome friends to participate in the discussion!
Revision of the Securities Law 10 Highlights:
(1) Stock issuance registration is reviewed by the exchange
Although there have been many rumors about the registration system in the market before, the draft amendment to the Securities Law is for the first time to clearly state that the public issuance of shares and plans to be listed and traded on the stock exchange, the stock exchange is responsible for reviewing the registration documents. If the
exchange issues a consent, it shall submit the registration documents and review opinions to the securities regulatory authority. If the securities regulatory authority does not raise any objection within 10 days, the registration shall take effect.
It is worth noting that the draft states that the entry into force of the registration does not indicate that the securities regulatory authority of the State Council makes a substantial judgment or guarantee on the investment value or investment income of the stock, nor does it indicate that the securities regulatory authority of the State Council makes a guarantee on the authenticity, accuracy and completeness of the registration documents.
(2) The penalty standard for fraud issuance is greatly increased
registration system means "leniency", and penalties must be increased to strictly prevent fraudulent issuance.According to the draft, if the issuer "conceals important facts or fabricates major false content" in the prospectus and has not issued securities, he shall be fined not less than RMB 1 million and not more than RMB 10 million, while the current maximum penalty standard is only 600,000; if the securities have been issued, he shall be fined not less than 2% but less than 10% of the amount of illegally raised funds, and the current maximum standard is 5%.
(3) New cash dividend system
Inadequate cash dividend has always been a major problem in the Chinese stock market. In order to solve this problem, the draft clearly states that on the premise of respecting corporate autonomy, listed companies are required to clarify the specific arrangements and decision-making procedures for cash dividends in their articles of association.
According to the draft, if a listed company has a profit after making up for losses and withdrawing statutory reserve funds in the year, cash dividends shall be distributed in accordance with the provisions of the company's articles of association.
(4) Securities partnerships can be established
In the chapter "Securities Business Institution", the draft clearly puts forward the concept of "securities partnership", which means that partnership securities companies will be allowed to be established. If the
draft stipulates that one of the securities businesses stipulated in the draft operation of securities companies and securities partnerships, the minimum registered capital or capital contribution is RMB 30 million. If two or more securities businesses are engaged in, the minimum registered capital or capital contribution shall be calculated in conjunction. "The core asset of the securities industry is people. Through partnership, we can not only retain talents, but also create a "century-old store" like Goldman Sachs." said Li Daxiao, chief economist of Yingda Securities.
(5) Securities practitioners "stock trading" lifted ban
In recent years, the question of whether securities practitioners can enter the market directly has been a hot topic of concern to the market. This time, the draft clearly states that securities practitioners can buy and sell stocks, but also sets corresponding regulations.
According to the draft, practitioners of securities operating institutions, securities trading venues and securities registration and settlement institutions, staff of securities supervision and administration agencies of the State Council, and other securities practitioners shall declare their own and spouse securities accounts to their units in advance, and declare the transaction status within 3 days after the transaction is completed.
(6) reserves space for overseas companies to list domestically
After a long-term discussion on the "International Board" issue failed, four clauses in the draft announced this time specifically make relevant provisions for overseas companies to list domestically.
These terms and conditions involve the securities laws and regulatory systems of the country or region where the overseas issuer is located, information disclosure requirements for domestic listing, financial accounting reporting requirements, and securities registration and settlement requirements. Analysts believe that this does not necessarily mean that the "international board" will be opened, but it does reserve necessary legal space for overseas companies to list domestically.
(7) New clause prohibits cross-market manipulation
draft new clause prohibits cross-market manipulation and prevents price manipulation between derivatives market and spot market. Prohibited behaviors mainly include: in order to obtain improper benefits in derivative trading, and to affect the market price of derivative underlying assets through means such as pulling, suppressing or locking; in order to obtain improper benefits in derivative underlying assets trading, and to affect the market price of derivative products through means of pulling, suppressing or locking.
(8) Using the "Unpublished Information" transaction responsibility insider trading
draft provisions, it is prohibited to prohibit employees of securities trading venues, securities registration and settlement institutions, securities operating institutions, securities service institutions and other financial institutions, staff of relevant regulatory departments or industry associations, and other persons who have obtained undisclosed information due to work and responsibilities, to buy or suggest others to buy or sell securities related to the information, or to disclose the undisclosed information. The "unpublished information" here in
refers to information that has a significant impact on the market price of securities except insider information and has not yet been disclosed. If the transaction uses undisclosed information to cause losses to investors, the liability for compensation should be borne the same as insider trading.
(9) If a listed company commits fraud, you can first agree to compensate
to buy stocks. What should I do if I buy a listed company that commits fraud? The draft stipulates that if investors suffer losses due to fraudulent issuance, false statements or other major illegal acts, the issuer's controlling shareholder, actual controller, relevant securities operating institutions, securities service institutions, and investor protection institutions recognized by the securities regulatory authority of the State Council may reach an agreement with investors on compensation matters and provide advance compensation.
This means that investors who have been falsified by listed companies have an additional channel for rights protection in addition to civil litigation, which can obtain compensation through investor protection institutions, and then they can continue to pursue compensation through civil litigation.
(10) Civil compensation can be recommended for representative litigation
Due to the lack of a class action system, shareholder claims have always been a major problem. The draft stipulates that when investors file civil compensation lawsuits for securities such as false statements, insider trading, market manipulation, and if one party has a large number of parties, the representative may be elected to conduct the lawsuit in accordance with the law.
Investor protection institutions recognized by the securities regulatory authority of the State Council may participate in litigation or liquidation procedures as representatives.
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