The Practice And Economic Consequence Analysis Of Securities Support Litigation Of China Securities Investor Services Center

The new "Securities Law" implemented in March 2020 conforms to the call of the market and creates a securities class action system with Chinese characteristics,which formally stipulates that investor protection institutions can act as litigation representatives.As the only institution that can directly support the securities litigation as the investor’s litigation client,the small and Medium Investors Service Center of China Securities Corporation(hereinafter referred to as the "investment service center")has carried out supporting litigation activities long before the implementation of the new securities law.The establishment of the securities supporting litigation system and the investment service center has greatly promoted the protection of the legitimate rights and interests of small and medium-sized investors,restrained the listed companies from infringing on small and medium-sized shareholders,and ensured the healthy development of the securities market.Through the method of case study,this paper takes two cases of misrepresentation litigation Tiancheng holding and Chaohua science and technology as examples,summarizes the three criteria of materiality determination,determines the period of compensation,the impact of system risk on the amount of compensation,analyzes the compensation situation and the compensation subject,and summarizes the needs of Investment Service Center and small and medium-sized investors when they participate in the misrepresentation cases Special concerns.In addition,this paper adopts the event study method and financial index evaluation method to analyze the economic consequences of Tiancheng holding and Chaohua technology’s misrepresentation litigation in the future.This study finds that when the investment and service center sends litigation information to the securities market,the AR and car of the two case companies show a downward trend since the event date,showing a negative market reaction.Through the study of the financial indicators of the case company,it is found that in the face of the continuous compensation pressure brought by the misrepresentation supporting litigation cases,the debt repayment and profitability of the listed company have been negatively affected,and the quality of its accounting information has improved in terms of reliability and robustness.In addition,this paper analyzes the spillover effect of securities support litigation activities of the investment and service center,and finds that the investment and service center actively carries out securities support litigation activities,which makes small and medium shareholders and private lawyers actively participate in securities support litigation;and through the long-term practice of the investment and service center and the people’s securities support litigation,the new securities law has a positive impact on securities support litigation It is also constantly improving.Finally,based on the above research,this paper draws a conclusion,and puts forward opinions and suggestions on the support of the investment and Service Center for litigation activities,the protection of the rights and interests of small and medium-sized investors,and the improvement of listed companies’ participation in securities activities.