| The system of disgorging short-swing insider profits,constructed to prevent insider trading,has been established for nearly a century.It is controversial both in legislative and academic circles for the reason that the nature and elements of short-term trading are different from the traditional securities fraud,and the legitimacy and rationality of its punishment are relatively weak.As the main means to regulate short-swing trading,the disgorging system had experienced fierce debate at the beginning,and finally excluded the punitive position both in legislation and judicature.But in the process of localization,the system of disgorging shortswing insider profits gradually appears punitive characteristics due to the administrative punishment rules,and the short-term trading behavior of insiders is therefore prohibited.The values of fairness and efficiency involved in the system are also facing more fierce conflicts.Many countries have objections to “disgorging short-swing insider profits”,which shows that the basis of the system really needs to be discussed.From the perspective of regulation ideas,the system prevents insider trading with very strict regulations,which is only suitable for use in a specific period of time and should not continue to the mature modern securities market.The rigid identification method and serious legal consequences lead to the incompatibility between this system and the existing securities market regulation logic,which leads to more problems than it solves.Because of the weak foundation of the legitimacy of the system,legislators and scholars are unable to accurately judge the purpose of the system,including whether it should be punitive which further leads to the inability to determine the calculation standard of profit.In addition,whether from the perspective of the harm of insider trading or the loss of investor trust,attributing the profit to the company is also incorrect,as the company hasn’t been damaged by short-term trading.The construction of the system is based on the value it carries.The crux of the thinking and logic level can’t be solved by simple adjustment at the technical level.It is necessary to analyze the current regulation ideas of short-term trading,from the perspective of the balance between preventing insider trading and maintaining trading freedom,ensuring market efficiency and stabilizing market trust,and pursuing the balance between corporate interests and protecting social interests.Analysis shows that although the system of disgorging shortswing insider profits plays a certain role in preventing insider trading and stabilizing market trust,but it isn’t effective and necessary,and exists disadvantages such as restricting insider trading freedom and reducing market efficiency.Classifying the profit into the company is also not an appropriate choice,because it is inconsistent with the value expected to be maintained by the system.The idea of dealing with short-term transactions should change from the traditional absolute prohibition to the dredging regulation based on the information disclosure system.Under the guidance of the above logic,the traditional system also needs to be reconstructed.First of all,it is necessary to establish an insider short-term trading information disclosure system.Specifically,replace the prohibition provisions with information disclosure,and replace the trading penalties with disclosure liability.Secondly,formulate insider shortterm trading income cut-off rules,which need to establish the cut-off rules of comprehensive income,while clarify the calculation method of actual income.Thirdly,guide the flow of account of profits to investor protection purposes.In the long-term planning,adjust the direction of the company’s profit,and in the short term,limit the use of the profit.Last but not the list,build a normal management mechanism for insider short-swing trading.Although the lifting of the ban mode solves some problems that are difficult to deal with by the traditional mode,it also makes short-term trading a normal behavior.Therefore,it is also necessary to build a normal interest collection mode and establish a normal attention and supervision mechanism. |
