Poison Pill Decision-making Legal Regulation Research

With the listed companies of my country listed overseas more and more popular, someoverseas capital markets adopt of anti-takeover measures are been adopted by overseas listedcompanies in our country. In these anti-takeover measures, the Poison Pills is more important.The meaning of Poison Pill decision-making is when the company has been hostiletakeover, the inside agency decide whether to implement the Poison Pill. Because the PoisonPill exists conflicts of interest in main subject. The largest conflict of interests is who canmake decision of Poison Pill.This is also the most important thing to build a complete system, interest balance in legalregulation system. Therefore, the key of the Poison Pill legal regulation system is who havethe decision-making in the Poison Pill.There are two theories in decision-making power of Poison Pill: the determinism ofboard of directors and company shareholders. The former argues that the broad of directorshave more advantages in anti-takeover of companies than the company shareholders, and onthe basis of the directors’ duty of faith theory and stakeholder theory, the target company haveresponsibilities in the interests of the stakeholders to decide whether to implement the poisonpill. Another theory according to the traditional company law that the shareholders can makea decision in Poison Pill.These two theories are behaved two models in companies’ practices. One is the broad ofdirectors in US to make a decision, the other one is by company shareholders. But in theJapan, it has been combined. The primary is shareholders, the broad of directors are assistant.By the major countries about the Poison Pill decision legal system of analysis, we can findthat they chose the model is based on the different securities market management mode,legislative system, legislative ideas, and the theory of company law on the basis of the state ofthe union. So we should choose a right model based on our national conditions.This report according to analysis the present status of the poison pill plan, typical cases,and poison pill decision rights legislation present situation, has found the system of PoisonPill is not completed in our country: the directors’ duty of authority and the specification ofthe target company, poison pill to judicial review and the improvement of small and mediumshareholders’ rights relief system.With author opinion, people should confirm that the decision of Poison Pill, to build thesystem of legal Poison Pill completed, improve the small and medium-sized shareholdersshareholder rights relief system in the process of implementation of the poison pill. Wechoose the model that the shareholder is the main body of Poison Pill decision-making power,and the broad of directors are assistance. To give the broad of directors some access control,as the same time we must improve the fiduciary duties. Judicial organizations can accordingto business judgment rule and main purpose of the judicial rules to analysis by the standardsof directors’ duties whether fulfill obligations. And onus probandi can belong to the broad ofdirectors of company. At the same time, to complete the system of small and medium shareholders’ rights judicial relief because of balance the gap of interests between the smalland medium shareholders and large shareholders.