Securities Intermediary Agencies Have False Statements And Bear Joint And Several Liabilities,and How To Bear Internal Responsibilities

The joint liability of intermediaries stipulated in Article 163 of the Securities Law can be said to be "rigid".It is generally understood that if an intermediary institution cannot prove that it is not at fault,it must bear all joint and several liabilities;if an intermediary institution can prove that it is not at fault,it will bear all joint and several liabilities,so that in practice,some cases do not distinguish the subjectivity of the intermediary institution.The degree of fault and the strength of the causal factor shall directly order the intermediary institution to bear joint and several liability for all the losses of the investor,that is,the intermediary institution shall be required to bear joint and several liability for the damage caused by the false statement to the investor according to the principle of presumption of fault.However,after issuers and listed companies assume responsibilities,there is a lack of unified regulations on how to properly distribute responsibilities among intermediaries,and it is rarely involved in practice."Several Provisions of the Supreme People’s Court on Hearing Civil Compensation Cases of False Statement Infringement in the Securities Market" issued on January 21,2022.This is the latest legal document in my country on the liability of intermediaries for false statements.It is a round of overhaul of the "Several Provisions on the Trial of Civil Compensation Cases Arising from False Statements in the Securities Market" dated January 9,2003 after years of deliberation and argumentation.The issue of liability sharing and recovery among the parties who bear joint and several liability is stipulated in principle,namely,it shall be dealt with in accordance with the provisions of Article 178 of the Civil Code.,my country’s securities laws and regulations,departmental rules and regulations are not uniform,and there is no clear conclusion in my country’s judicial practice.Through searching judicial precedents in recent years,it is found that in the "Huaze Cobalt Nickel Case",the Chengdu Intermediate People’s Court of first instance ruled that the securities company serving as the sponsor and the accounting firm serving as the auditor should bear a certain proportion of compensation liability,but the second instance Sichuan Sichuan The High Court commuted the two intermediaries to assume full joint and several liability.In the "Wuyang Debt" case,the first instance judged that the rating agency bears 10% and the law firm bears 5%of the joint and several liability.In the "ST Zhong’an" case,the Shanghai Higher People’s Court,in the second-instance judgment,revised the judgment of the first-instance financial court that securities companies and accounting firms were jointly and severally liable for the listed company’s payment obligations,creatively sentenced as The financial advisor’s securities company shall be jointly and severally liable for the payment obligation of the listed company within the range of 25%,and the accounting firm that provides auditing services shall be sentenced to be jointly and severally liable within the range of 15%.Before the "ST Zhong An" judgment,in cases involving intermediaries that were jointly and severally liable for false statements,the effective judgments all ordered the intermediaries to be jointly and severally liable for all losses of investors and the listed company.This case is the first final judgment of the "proportional joint and several liability" of an intermediary agency,which is a milestone in clarifying the responsibilities of the intermediary agency and urging the intermediary agency to fully perform its duties of diligence and due diligence.In the determination of the responsibilities of intermediaries and other relevant subjects,we expect Chinese courts to make further progress on such issues as civil fault review,how well the interests of all parties are balanced,and how to achieve substantial fairness through judicial decisions.Of course,this problem itself is also a difficult problem in the field of civil liability for securities misrepresentation in my country,and it is difficult to directly achieve the effect of "satisfying everyone" through a certain case.At present,since the determination of the liability of securities intermediaries also involves complex judgment standards,consideration of fault,strength of causal force,and application of laws,etc.,after securities intermediaries assume joint and several liability,how will the amount of compensation be determined by securities companies,accounting firms and lawyers? The issue of internal apportionment between securities intermediaries such as firms is worth studying and thinking about.It requires long-term joint efforts of the theoretical and practical circles,and even the accumulation of time,in order to jointly explore a relatively reasonable boundary.