Research On The Legal Risk Caused By Super-raised In GEM IPO

This article took the IPO in GEM as the object of study. We studied the causesof Super-raised in GEM IPO and research on the interest and the legal risk caused bythis kind of super-raised. The author generally took the action of the stakeholders ofIPO into account, and mainly discussed the legal risk relevant. Combined with therecent dramatic events in the U.S. securities and even financial markets, we tried toexplore the path of legislation in securities law, which might solve the phenomenon inSuper-raised in GEM IPO.This article first introduced the basic concepts and the causes of Super-raised inGEM IPO. We focused on the IPO market pricing and saw it as the fundamentalreason for Super-raised. In our current economic environment, the researching on theSuper-raised in GEM IPO could make significant contribution to the development ofeconomic, the efficiency and order of Chinese capital markets.This article then studied the reasons why the Super-raised in GEM IPO wouldlead to legal risks. Our study focused on two primary reasons: the concentration ofcorporate control and the common interests of stakeholders. Chinese Enterprises,which have been affected by the local culture, have always demonstrated acharacteristic of highly centralized control which brought about higher legal risks.And what most imperative is that the huge interest of super-raised pushed thestakeholders took some action that had a high possibility which could arouse legalrisks.The stakeholders’ activities played a key role in this article. We studied theaction of stakeholders——including issuers, shareholders, directors and Executives,and Securities intermediaries——when a new IPO commenced. We focused on thosesubjects who faced huge interest and might do something illegal.At last, combined with previous research and analysis, we gave some think andsuggestion in govern and legislation. We mainly talked about supervise, punishment and the ease of Super-raised in GEM IPO itself. We also gave several cases inAmerica, and tried to draw lessons from them.