Shanghai Stock Exchange Will Launch The Compulsory Delisting Mechanism

According to the investigation of the regulatory department, in order to "help" the controlling shareholder Huaxintai to "fulfill" the performance commitment of share reform, Boyuan Investment forged bank acceptance bills for many times during the period from 2011 to 2014, fabricated major transactions such as purchasing bank acceptance bills, bill replacement, discount, and payment of advance with the performance commitment funds of share reform, and disclosed periodic reports with seriously false financial information. Of which, the 2011 annual report falsely increased assets by 347.05 million yuan, accounting for 69% of the total assets; The 2012 annual report falsely increased assets by 364.5583 million yuan, accounting for 62% of the total assets, and falsely increased profits by 18.932 million yuan, accounting for 90% of the total profits; The annual report of 2013 falsely increased assets by 378 million yuan, accounting for 62% of the total assets, and falsely increased profits by 23.6454 million yuan, accounting for 258% of the total profits; The semi annual report of 2014 falsely increased the operating revenue and profit by 3.174 million yuan, accounting for 1327% of the total profit.

Boyuan investment not only has a long time span of major violations, but also involves a huge amount of money, which is enough to confirm the seriousness of its violations and the bad nature of its violations. On the other hand, if the Dongchuang incident happened and was investigated by the regulatory authorities in June last year, perhaps the 2014 annual report of Boyuan Investment was also a false report. After all, investors can only be "convinced" by its annual report and semi annual report if its story of inflated assets continues to be "compiled".

The regulatory authority's institutional arrangement is conducive to safeguarding the interests of investors, but it is not conducive to maintaining the seriousness and deterrence of the delisting system, and is not conducive to cracking down on illegal acts. For major illegal companies, it is proper for them to compensate investors for their losses, and forced delisting must not leave any "tail". Otherwise, it will connive at those who cheat list The wrongdoing of the investors will be carried out in the issuance of new shares in the future Registration system This will be especially true in the case of. Therefore, the regulation is recommended to be revised by the regulatory authorities.

in the light of Boyuan Investment The regulatory authorities recommend that investors file a civil compensation lawsuit against listed companies in accordance with the provisions of Articles 5 and 6 of the Several Provisions of the Supreme People's Court on the Trial of Civil Compensation Cases Caused by False Statements in the Securities Market. However, in the context of frequent "difficulties in case filing, litigation, hearing and enforcement" in rights protection, the difficulties in rights protection will lead many investors to "stay away" from litigation, which means that the legitimate rights and interests of investors whose interests are damaged cannot be protected. If listed companies can take the initiative to set up investor compensation funds, perhaps the situation will be much better.

On the other hand, although the regulatory authorities have launched the compulsory delisting mechanism for Boyuan Investment, there is still a big question mark about whether it will really "be delisted" and whether it will "farewell" to the capital market from now on. According to the new delisting regulations issued last year, "Several Opinions on Reforming, Improving and Strictly Implementing the Delisting System of Listed Companies", and the relevant provisions of the Stock Listing Rules of the Shanghai Stock Exchange, if a company whose listing is suspended due to major violations can fully correct its illegal acts during the period of suspension of listing If the relevant responsible persons are removed and replaced in a timely manner and appropriate arrangements are made for bearing civil liability for compensation, they may apply to the Shanghai Stock Exchange for resumption of listing. If Boyuan Investment does not want to be "delisted", it may, according to the system, achieve its "qualification" to apply for resumption of listing by retroactively adjusting financial data, punishing relevant responsible persons, and taking the initiative to bear civil liability. Then, if other conditions are met, even if Boyuan Investment is delisted, it is possible to re enter the capital market in the future. In other words, Boyuan Investment may continue to be "active" in the market even if there are major violations.