Cao Zhongming Talked About How To Protect The Registration System.

At the national securities and futures regulatory conference held in 2015 recently, Xiao Gang, chairman of the securities and Futures Commission, said that promoting the reform of stock issuance registration system was the top priority of the capital market reform in 2015. It is a systematic project involving the market participants and is also an important breakthrough for the SFC to promote regulatory pformation.

This not only explains the importance of registration reform, but also explains the urgency of reform. In 2015, it was also known as the key year of the stock issue registration system reform.

With the development and expansion of China's capital market, the drawbacks of the approval system are becoming increasingly apparent.

Because new shares need to be approved, regulators actually play a role in checking the profitability, investment value and information disclosure of new issuers, and weaken the responsibility of intermediaries. Because of the implementation of the approval system, regulatory authorities can use it to regulate the stock market. The "visible hand" is hidden in the market, which is not conducive to the marketization of A shares. Similarly, because of the approval system, a company's listing is a long journey, and the time cost is high, which often leads to the phenomenon of "barrier lake" of new shares.

All this needs to be changed.

The registration system of IPO can eradicate many malpractices under the approval system, and really solve the problems in the IPO process by the market itself.

At present, there is still a legal obstacle to the implementation of registration system, which needs to be revised.

Even if this legal obstacle was successfully eliminated in 2015, I believe that the reform of IPO registration system needs to take measures from four aspects to escort it.

First of all, we should effectively enhance the quality of information disclosure of issuers.

The real, accurate, complete and timely disclosure of information is not only the requirement of regulators to issuers, but also the most important and crucial step in the registration system of stock issuance.

The regulatory authorities no longer profit the issuers.

Under the circumstances of "endorsement", the quality of information disclosure of issuers is particularly important.

No matter how the issuer grows and how the texture is, they must fulfill the necessary information disclosure obligations, and decide whether the price will be issued or not.

If there is any violation, it should be severely punished.

Secondly, we should further strengthen the responsibilities of intermediary agencies.

In a sense, under the background of the approval system, intermediaries are hiding under the shade of the regulatory authorities.

Even if there was a fake like the green earth and the Wan Fu Sheng Ke.

Nor are all intermediaries punished properly.

The implementation of registration system must change this phenomenon, which means that intermediaries will shoulder more responsibilities.

Those who disregard the interests of the market and investors only for their own interests, and the intermediary organizations that fail to perform their diligent and conscientious duties, should be swept away and take measures to prohibit the relevant responsible persons from entering the market for life.

Third, we need to reform.

The relevant provisions of the new regulations.

Under the registration system, although the issuer's profitability is no longer excessive requirements, but focus on the quality of information disclosure, but also can not avoid fraud issuance, fraud listing and so on.

In accordance with the provisions of the "opinions on reforming and improving and strictly implementing the delisting system of listed companies", the issuer is allowed to suspend the listing even if the issuer does not comply with the issuing conditions and defraud the approval of the issuance. If the stock exchange can make a comprehensive correction of the illegal behavior, make timely withdrawal of the relevant responsible personnel and make proper arrangements for the civil liability for compensation before making a decision on the termination of the stock listing paction, it may still apply for the resumption of listing.

The stock exchange shall make a decision to agree to resume its listing within the prescribed time limit.

Such a provision is obviously unreasonable and is not conducive to combating fraudulent issuance.

The author recommends that this clause be amended to stipulate that the listing of fraudulent public offerings will be implemented immediately and the mandatory delisting will be carried out immediately.

Fourthly, the group action system is introduced.

After the registration system has been implemented, the listing threshold has been substantially reduced, and it is not ruled out that ulterior motives use "rules loopholes" to enter the capital market.

At present, the rights protection of investors in China's capital market is generally difficult to file, difficult to sue, difficult to sit in court and difficult to enforce.

The single investor and the listed company fight alone to defend their rights, not only the litigation time is long, the litigation cost is high, but also very difficult to succeed.

If we introduce the class action system, we can solve this problem well.

The most important thing is that the group action system can provide institutional guarantee for investors' rights protection on the one hand. On the other hand, it will also pay a heavy price for violators. It will have a great deterrent against fraudulent issuers and fraudulent listers.