Hao Xuguang: Protecting investors lies in regulating market infrastructure

(Source: "w88 online sports betting Times" Date:2013-06-19）

The China w88 online sports betting Regulatory Commission recently issued the "Draft for Comments on the Reform of the New Stock Issuance System",IPO(Initial Public Offering) The floodgates have been opened, and opinions from all sides are emerging.6month18On the topic of China's stock market regulation and the protection of small and medium investors, the w88 online sports betting Times Caiyuan Community (cy.stcn.com)InvitedProfessor Hao Xuguang, w88 casino of International Business, w88 casinoCommunicate with Caiyuan netizens.

w88 online sports betting Times: This opinion draft has new restrictions on issuers' reduction of holdings, such as "it cannot reduce its holdings below the issue price within two years, and its willingness to reduce its holdings must be disclosed in advance." Can these really effectively inhibit listed companies from making money?

Hao Xuguang:The original intention of the regulatory agency is to link the non-reduction price and lock-up period of large and small holdings with the issuance price, thereby achieving the purpose of inhibiting issuers from raising money through issuance at high prices. Although its motives and intentions are correct, the relevant provisions still have loopholes, and their implementation can be circumstantial.

If it is required that the holdings of large and small companies cannot be reduced if the price is lower than the issue price within two years, on the surface, the reduction of large and small companies is locked with the issue price, but in fact, it may have a limited effect on suppressing high-priced issuance. Because in the case of a high-price issuance, although the stock is more likely to fall below the issue price, and may even take a long time to break, listed companies can still choose to reduce their holdings during the market rise, or use various internal benefits to stimulate the stock price and push it above the issue price or even higher, in this way to assist large and small companies to complete the reduction.

w88 online sports betting Times: The traceability mechanism of the stock market has always been criticized. Compared with foreign stock markets, is there anything we can learn from in this regard?

Hao Xuguang:A dynamic traceability mechanism should be implemented not only for the listed company itself, but also for the accounting firms responsible for auditing the company to be listed, the relevant law firms that issue legal documents, and the sponsoring w88 online sports betting firms and sponsors.

If a company to be listed falsifies its operations or performance during the listing process, the relevant accounting firms and law firms, as well as the sponsoring w88 online sports betting firms and sponsors must first bear legal responsibility. The liability is divided into two parts: on the one hand, one can consider suspending or terminating their agency qualifications. In serious cases, their business licenses and business qualifications should be revoked; secondly, heavy fines should be imposed. Part of the fine will be used to compensate the injured small and medium-sized investors, and the other part can be directly transferred to the stabilization fund.

In addition, there should be a prosecution system with no time limit. As long as there is fraud, no matter the length of the limitation period, everyone should be held accountable.

w88 online sports betting Times: Is it necessary for management to rescue the market?

Hao Xuguang:From the perspective of public interests and the protection of small and medium-sized investors, the market should be rescued at this stage, but we are opposed to using administrative means to regulate the market.IPOReform is difficult to push forward. It is related to local protection, the game of interests between departments, and the "unspoken additional costs" of the company's listing process. Therefore, the bailout should fundamentally stop the money-circling styleIPO. We need to rescue the market, but I personally oppose the use of administrative means to regulate the market.

Attachment: Original report link

http://epaper.stcn.com/paper/zqsb/html/2013-06/19/content_478706.htm