Study On Unfair Related Party Transactions In Chinese Listed Companies

Related party transactions are ubiquitous phenomena in securities markets of all countries, which have positive sides. Whereas the unfair related party transactions manipulate earnings by unfair price for unreasonable motivations. These transactions break the open, fair and just rules in securities market, infringe on benefits from minority shareholders and lower the qualities of listed companies. China's corporate governance structure problems, weak supervision and other factors are conductive to the unfair related party transactions. So it's significative to study the unfair related party transactions in our countries'listed companies and promote countermeasures.This dissertation is expected to put forward some proposals to normalize unfair related party transactions by analyzing judgment and representations of these transactions. Three chapters are contained. Chapter 1 illuminates three criteria in judgment of unfair related party transaction, which include unreasonable transaction motivations, unfair transaction price and negative transaction impacts. It also explains the definitions of related party transaction by comparing china's accounting standards with International and American standards. Chapter 2 analyzes the dealings of unfair related party by classifying the transactions. It cites thirteen conducts including related party sales, related party occupied capital, related party surety and five concealed dealing forms. Chapter3 consists of two normalizing points of view that are reinforcing information disclosure and perfecting corporation governance structure. It suggests perfecting the system of information disclosure, strengthening the supervision upon information disclosure and punishing the get-out-of-line conducts to reduce the insufficient, uncertain and unpunctual disclosure. To solve the problems in corporation governance structure, the author proposes to advance the reform of non-tradable shares, establish honest obligations of controlling shareholders, construct the system to protect the minority shareholders, perfect the independent directors system and set up the inner control on related party transactions.