The Legal Effect Of Anti-takeover Amendments In The Listed Companies

In recent years,there have been many eye-catching acquisitions and anti-takeover battles in China's capital market.With the vigorous development of economy and society,the control over listed companies by different parties is becoming more and more competitive.The wave of takeovers of listed companies has surged.As for the acquisition measures,listed companies mainly adopt and modify the anti-acquisition items in their articles of association.The constitution of the company is of great importance to the company,and the development and governance of major enterprises and groups cannot be separated from the norms and guidelines of the articles of association.In the articles of association of listed companies,the anti-takeover clauses are more and more frequently adopted.The provisions of the articles of association of listed companies will help protect the interests of the target company and its shareholders as well as avoid the embarrassing situation of "prisoner's dilemma".The existence of the anti-takeover clause can hinder the company's acquisition process and give the managers of the target company a breathing space.Shareholders,meanwhile,need not to sell their shares in a hurry,but they can think calmly before selling shares their held and get a better price.Besides,the anti-takeover clause can rise the cost of acquisition and reverse acquisition,and reduce the risk of transfer control over the target company.By analyzing and summing up the implementation of different types of anti-takeover clauses in listed companies,the common anti-takeover clauses mainly include different types of clauses as follows,to limit shareholder's rights,to increase shareholder information disclosure obligations,staggered boards,golden parachutes,absolute majority terms,etc.Setting the anti-takeover clauses in the articles of association of listed companies gradually become the mainstream of resisting the hostile takeovers,however,as our country's legislation has not yet set any particular laws or regulations regulating the anti-takeover clauses in the articles of association of a listed company.And some common anti-takeover clauses are usually with the purpose of setting the barriers to shares purchase,or restricting shareholders' rights as the means of limiting shareholders' rights to nominate directors as well as their temporary proposal rights and power to convene the shareholders' meeting,etc.Many of the listed companies with relatively dispersed ownership are beginning to prepare and take measures such as modifying the company's articles of association to set up anti-takeover clauses.But for this phenomenon,the Shenzhen stock exchange only issued a letter of concern.This kind of gentle supervision mechanism can only be a palliative,which can only guide and supervise listed companies briefly.After all,the stock exchange has limited manpower and material resources,which make it difficult to check the market systematically.Therefore,the relevant norms are urgently needed.All in all,our country should discuss the value of the terms of the anti-takeover as soon as possible.Through establishing and improving the relevant anti-takeover mechanism,it can ease the embarrassment at present that there is no law in relation to the relevant problems,and better solve the problems encountered in actual operation and disputes,then make it return to the normal orbit of trade legal systemThe first part of this paper is the introduction,which mainly introduces the reasons of writing and its background analysis.Through the analysis of literature review,clarifying and rationalizing the related concepts,which will help the further study.The second part of the thesis is to make clear the relevant concepts in relation to the acquisition and anti-takeover war.In this paper,we introduce the concepts of the acquisition,clarify the meaning of the terms of the acquisition and introduce eight common anti-takeover clauses.The paper then focuses on analyzing the opposing views in relation to the above eight common anti-takeover clauses.The third part analyzes the legality of the anti-takeover clause.According to the nature and characteristics of the articles of association,we can find that autonomy,legality,incompleteness and openness are the most important characteristics of the articles of association.Then the article analyzes the legality boundary of the anti-takeover clause.The anti-takeover clause shall not violate the mandatory provisions.More stringent requirements set in the anti-takeover clauses compared with the relevantmandatory norms are subject to specific analysis.There should be boundary between acceptable and unacceptable arbitrary rules and the arbitrary rules shall not be adopted without any limit.The fourth part is based on the examples of the application of a wide range of typical anti-takeover clauses,and thus to conduct in-depth analysis.This paper mainly analyzes some anti-takeover clauses,such as staggered board clauses,golden parachute clauses and clauses in relation to the restrictions on shareholder's temporary proposal rights.The fifth part discusses the trial practice of the UK and USA in the anti-takeover measures.By extracting the essence from the UK and USA practice,this paper seeks an anti-takeover legal track suitable for China's development.In the United States,Delaware is particularly rich in trial practice,and has concentrated more than half of the anti-takeover.Delaware approves the board of directors to implement anti-takeover measures.While the sixth part puts forward the suggestion for the construction of China's anti-takeover regulation system.In conclusion,the article suggests that the anti-takeover clause should be regulated in time.First,the regulators need to undertake the legislative responsibility of clarifying the legal bottom line and the free border in order to respond to the frequent problems in the acquisition and anti-takeover in the listed companies.Secondly,this paper recommends that the CSRC should set up the supervision mechanism in relation to the anti-takeover clause.Finally,it is suggested to regulate the effectiveness of several common anti-takeover clauses.The debates of control over China's listed companies are in the ascendant,and the anti-takeover measures will be constantly updated as the market becomes more and more active.It is very important for listed companies to set up anti-takeover rules in their articles of association as one of the weapons of defensive for acquisition.But the anti-takeover clauses should be adopted in accordance with the framework of the Chinese law.Therefore,the anti-takeover clause that violates the mandatory provisions of the law does not have the legal effect.Through rough analysis,this paper hopes to be helpful to the later research.