Legal Regulation Of Market Manipulation In Stock Buy Backs

Share buyback is a way of modern enterprise capital operation，share repurchases canbe to adapt the company’s development strategy to stabilize the share price, theimplementation of ESOP’s and other effects at different stages of the companyrunning. Since the1970s the system in after the rise of the United States, at first,spread to Western Europe and Japan of Asia, and gradually extended to other regionsof the world, plays a role in the whole financial market. in the nineties,our country tobe catch up with the pace of the world economy and introduced this system, althoughthe time of development is not long, but the regime in China has played a good role, itactive our country capital market, expanding the company the scope of investmentfor China’s economic development has provided institutional support.Share Repurchase system has a positive effect, but the system still has somedrawbacks, such as market manipulation, insider trading, harm the interests of thecreditors, etc., if the legal regulation system is not perfect, it is easy to use to grabthe ill-gotten gains, so the examples in the country and the world are not uncommon.Since more attention abroad for share repurchases system plus a long time to develop,the entire system is relatively sound norms for prevention and treatment of sharerepurchase drawbacks also more successful. China’s share buyback start later, both forthe rational use of the system or the level of the adverse consequences of prevention,there is a gap between the developed countries is not small. For more efficient use ofthe system, we should constantly improve our own system construction, providing amore standardized regulation system; promote the development of China’s capitalmarket.The first part introduces the basic theory of share repurchases and marketmanipulation, first introduced the concept of share repurchase and characteristics ofdifferent forms of presentation and share repurchases, and secondly describes therelationship between share repurchases and market manipulation, several ways,including share repurchases and market manipulation in general contact and sharerepurchase market manipulation, and explains how the share repurchases are used tomanipulate the market, and finally introduce the two-sided effect of the sharebuy-back of this system, from two different aspects to introduce share buyback pros.In the second part of the paper, according to China’s existing laws, regulationscombined with other countries and regions of the world, the analysis of the legalsystem of our country’s level of share repurchase defects. Share Repurchase legal aspects of the problem exists in reasonable limits larger share repurchase legitimateform of shares repurchased cited lack of, for lack of definition of market manipulationof share repurchases, there is a problem on the conceptual and specific ways, in themonitoring system, the disclosure of specific information systems and operationalliability is not ideal, these problems have hampered the development of sharerepurchase in China.The third section presents a number of recommendations based on our sharerepurchase problem, in the sense of improvement proposals include legislation, citedthe case of a reasonable increase in share repurchase, widening the company’sinvestment channels, through a clear concept and offer more ways to manipulatestrengthening of market manipulation share repurchase authorization, and provisionsto expand the subject of a more detailed disclosure rules for the operation to improvethe information disclosure system, and build a stronger operational system of legalresponsibility.