Discussion On The Protection Of Medium And Small Stockholder In Delisting

Listed companies delist, means the listed companies lose the listed transactions qualifications because they do not meet the listed conditions or they violate the relevantlaws and regulations, maybe they just apply for it. It is well known to us that the stocks of the listed corporation have the characteristics of profitability, liquidity and risk.While the delistment of the companies will significantly damage to the circulation of stock, the benefits of stocks will be greatly reduced, thereby the risk of investment willbe increased.How to reduce the risk of investors which is caused by the compulsivedelistment of companies and to protect the legitimate rights of investors are the mainproblems to solve in this article.This paper first demonstrates the definition and classification of listed corporations in theory, through the analysis of the legal basis, it tells that the reason of listed Corporations’ compulsory withdrawal is the unity of market operating efficiency, marketsteady order and market fair trade.Subsequently, the legal basis and conditions of thecompulsory withdrawal of the listed corporation as well as the impact on share interests of small and medium-sized investors may have been analysed, which offers the theory evidence for the investors above.Then, to analyse and summarize the relevant legislation’s development of the security market in three stages from the vertical,which isto protect minority shareholders’ interests in China, puting forward the present defects and deficiencies of China’s legislation on listed corporations’ protection of small investors’ equity interests, which including: after delisemnt, the civil liability of compensation is not perfect, specified index is defective, the regulation has some loopholes, investor litigation system is not well-organized.Next, from the comparative analysis of the United States, Britain, Germany and other stock markets in horizontal angle, we obtain the enlightenment and put forward some measures for China which are from the compulsory withdrawal of some foreign shareholders’ rights and interests protection system.Finally, the author, through the analysis and demonstration to the full text, and learning about the weak protection principle of civil law, administrative law and other departments, raises the principle that the listed corporation of compulsory withd rawal should protect minority interests.What’s more, to continuously improve the drawbacks of the relevent principles and put forward specific measures on the improvement of the system of the protection of minority shareholders’ interests by compulsive delisted corporations，including safeguarding the right to know of medium and smallinvestors，completing the civil liability system of subject of liability，building Classaction system of protection association and establishing protection fund of mediumand small investors.