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Constructing investor protection system with the rule of law as the core

May 16, 2019 03:14

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Since this year, May 15th of each year is the “National Investor Protection Promotion Day”. The purpose of the CSRC to set up this publicity day is to strengthen the awareness of investor protection in the whole society and comprehensively construct a new pattern of investor protection.

Protecting investor rights is a prerequisite for promoting healthy and sustainable market development. China's capital market has always paid attention to the work of investors, especially the protection of small and medium-sized investors' rights, and has also achieved great results. However, subject to various reasons, the level of protection of investor rights and interests in China is still unsatisfactory, and the phenomenon that investors, especially small and medium-sized investors, have been infringed on their legitimate rights and interests still occurs from time to time. After the investor's rights and interests have been infringed, it is more difficult to obtain relief, and the degree of relief is limited. It has become a prominent problem, and further improving the level of investor protection has become a common voice of all walks of life.

Investor protection is a very wide-ranging job. It is not a point, not just a face, but a very complicated three-dimensional project. In this system, it is necessary to play the role of public power such as law and administration, and also require investors to improve their own quality and change their investment philosophy. It is necessary for the listed companies that are the foundation of the capital market to be law-abiding and to require other types of intermediaries. In his position, he respects investors, respects investors, and protects investors. It is necessary to implement the "buyers' self-sufficiency" principle in investors, and also consider the problem of imperfect system support.

China's investor team is as high as 150 million people, of which more than 95% are small and medium investors. The large number of people and the high proportion of small and medium-sized investors make the task of investor protection extremely complicated and arduous. In order to advance the protection of investor rights and interests in a complicated environment, and to make the level of investor rights protection substantially improved over time, it must be simplified and simplified. Firmly grasp the two lines of marketization and rule of law, especially the rule of law as the core.

In general, the risks that investors face come from both the market itself and non-market factors. Market risk is what investors should bear. It cannot be protected and should not be protected. The risks from non-market are difficult to predict and difficult to avoid. Therefore, vigorously promoting marketization and promoting marketization from issuance and trading to various links is an important way to eliminate market distortions and eliminate non-market risks. It is also an important way to implement the "three public principles" and protect investors' rights and interests.

The main source of infringement of small and medium-sized investors' rights is still from other market entities, such as untrustworthy listed companies and their major shareholders, those who use insider information to trade, other investors who have capital advantages and maneuverability. To protect small and medium-sized investors from such violations, the most fundamental thing is to have a sound rule of law, to prevent precautions and to pursue afterwards. The lack of the rule of law in China's capital market has both the problem of lagging legislation and the flaws in the law enforcement system and the lack of law enforcement. For example, relying too much on administrative law enforcement and short-term judicial enforcement, the result is that human factors are prominent and predictability is seriously insufficient. The rule of law environment required for market operation is poor and operating costs are high.

Therefore, the core of protecting investors' rights and interests in the future should be to improve the law enforcement system and greatly enhance market expectations. If one day, the aggressor knows that the consequences of the violation are serious and highly certain, and the expectation that the investor obtains reasonable compensation and relief after being infringed is highly determined, then the investor protection work has reached a satisfactory level.

(Article source: Securities Times)

                (Editor: DF372)

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