Sponsor Compensation System Construction

In recent years,there have been numerous cases of false statements by issuers in China’s securities market.Among them,many cases are due to the sponsor’s failure to carefully review the obligations,condone their development,resulting in false statements and fraudulent investors in the listing documents,which harmed the interests of many investors.This invisibly hindered the sound development of the securities market and hit the confidence of small and medium investors.Therefore,the establishment of the sponsor’s first payment system as soon as possible is very beneficial to avoid the situation that investors are difficult to obtain compensation due to the issuer’s false statement.At the same time,it can force the issuer to strictly regulate the operation of the enterprise and urge the sponsor to fulfill its duty of loyalty and diligence.Thereby effectively preventing such incidents from happening again and protecting the legitimate rights and interests of investors.However,because the current provisions of the Securities Law on prepayments are too simple,it is necessary to analyze the connotation and legal theory of the first payment in the securities market.Explore its intrinsic theoretical basis and further demonstrate the existing significance of the system.Through the existing practical cases of the system(“Wanfushengke” and “Xintai Electric”),the article clarifies the status of legislation and judicial practice of the current sponsors’ compensation in China,and clarifies its compensation with civil litigation and investor protection.The relationship between the fund system.Analyzethe current deficiencies in the specific application of the system,such as the compensation standard for the first payment,the recovery problem after the payment,the responsibility distribution among the responsible directors,etc.,and try to put forward the author’s suggestion.Furthermore,it will contribute to the construction of the early payment system of China’s securities market,so as to promote the sponsor’s first payment system to become a long-term mechanism for investor protection in the securities market and enhance the confidence of the securities market.The article is divided into three parts: introduction,body and conclusion,in which the body consists of three chapters.The introduction discusses that under the current securities civil liability system,it is difficult for Chinese small and medium-sized shareholders to obtain compensation through civil litigation rights protection.Especially in the implementation of the system of securities issuance registration system,there are functional obstacles and structural defects in the system,which will lead to the cumbersome and lagging securities legal liability system.The CSRC has issued relevant regulations requiring sponsors to implement the system and ensure that the issuer is listed on the compliant basis through prior commitment.By combining case studies,the author studies the current status of legislation and judicial practice of sponsors in China,and clarifies its relationship with civil litigation compensation and investor protection fund system.Analyze the problems that may exist in the current implementation of the system and try to propose solutions.The first chapter discusses the responsibilities that sponsors should perform in the issuance – including “guarantee” and “recommendation”.Explain the connotation of the sponsor’s first payment system,and proceed from the concept to discuss the legal basis.The identification and implementation process of the sponsor’s advance payment will be introduced through two practical cases.At the same time,the importance of the establishment of the system was emphasized in terms of stabilizing the market and achieving high efficiency(compared with judicial channels).The second chapter discusses how the advance payment in China is coordinated with other litigation systems by discussing the relationship between the advancepayment system and the civil litigation compensation and investor protection fund system.First,the sponsor’s first payment system is a civil settlement between the joint and the injured investor as opposed to obtaining compensation through civil litigation.Investors receive the corresponding compensation by accepting the payment agreement.Secondly,once the payment agreement is signed,its effectiveness should be determined.In order to ensure the smooth implementation of the agreement,its enforcement power should also be confirmed through judicial review.Thirdly,in discussing how to correctly handle the relationship between the advance payment and the investor protection fund system,first analyze the positioning of the investor protection fund system,and then discuss the feasibility and combination of the two systems.Finally,the current problems of the first payment system will be analyzed,with a view to the targeted improvement and improvement in the future.The third chapter discusses the countermeasures for improving the advance payment of China’s securities market through procedural justice and entity norms.In terms of procedures,considering that in the process of early payment,investors do not have sufficient rights to participate,to know,and to vote.In order to balance fairness and efficiency,consider introducing a hearing system and a third-party supervision system to ensure fairness and scientific rationality.On the entity side,although there is no law to clearly define the system,the author suggests that the subject can be clearly defined.Starting from the establishment of appropriate fund managers,reasonable determination of compensation standards and scope,etc.,the construction of the first payment legal system.In addition,the issue of recovery after the sponsor’s first payment is worth exploring further.The reason is that the sponsor is not the sole subject of responsibility.It is necessary to introduce the subrogation right between the joint liability entities in the first payment system to realize the responsibility.Fair distribution.