On March 1, 2020, the new "Securities Law" officially landed, and listed companies ushered in new requirements for "strict management" of the securities market, including information disclosure of listed companies. The new securities law has greatly promoted the regulation in the field of private law, avoiding the shortcomings of the old securities law, which focused more on public law, emphasized the protection of national interests, provided for more administrative and criminal penalties, and far from strengthening private law remedies such as investor protection. One of the more typical is a single list of enterprise information disclosure chapter provisions. The setting of this special chapter makes the capital market more strict supervision of enterprises in information disclosure, and the punishment is also more fierce. At the same time, on the basis of the original administrative punishment, the protection of investors' rights and interests is vigorously imposed, so that once the listed company has violated the information disclosure, it will be in a state of "losing the wife and breaking the soldier".

First, enterprise information disclosure requirements

1. Information disclosure obligor

According to the provisions of the new Securities Law and its related laws and regulations, the disclosure obligors of listed companies mainly include the following subjects: listed companies; The issuer; Controlling shareholder of the company; The actual controller; Directors of listed companies are highly supervised. Among them, directors and senior managers shall sign written confirmation opinions on securities issuance documents and periodic reports; The board of supervisors shall review the securities issuance documents and periodic reports prepared by the Board of directors and put forward written review opinions, and the supervisor shall sign a written confirmation of the opinions; The directors, supervisors and executives of the issuer need to ensure that the remaining information disclosure obligations can disclose information in a timely and fair manner.

2. Content of information disclosure obligations

According to the provisions of the new Securities Law and its relevant laws and regulations, the information that enterprises should disclose mainly includes the following contents:

(1) Prospectus, offering prospectus, public notice of listing

The three explanatory books are necessary materials for the disclosure of securities information issued by enterprises. Due to the importance of the prospectus and the complexity of the disclosure process, here we need to make a brief explanation of the information disclosure of the prospectus: when an enterprise applies for an initial public offering of shares, after the China Securities Regulatory Commission accepts the application document, the enterprise shall disclose the prospectus declaration draft on the China Securities Regulatory Commission website in advance. After the application for public issuance of securities is approved by the CSRC, the issuer shall publish a formal prospectus before the issuance of securities. Information that has a significant impact on investment decisions should appear in the prospectus, such as the business scope of the enterprise and the operation of the enterprise. After the application for securities issuance has been approved by the China Securities Regulatory Commission (CSRC) and before the end of the issuance, if there is any important matter, the issuer shall give a written explanation to the CSRC, and with the consent of the CSRC, amend the prospectus or make a corresponding supplementary announcement. It should be noted here that the pre-disclosed prospectus declaration draft is not the official document of the issuer to issue shares, cannot contain price information, and the issuer shall not issue shares accordingly. At the same time, if the prospectus and listing notice cite the professional opinions or reports of the sponsors and securities service agencies, the relevant contents shall be consistent with the contents of the documents issued by the sponsors and securities service agencies, so as to ensure that the opinions of the sponsors and securities service agencies will not be misleading. If an enterprise issues a prospectus for offering corporate bonds, the information disclosure method shall be consistent with the prospectus.

(2) Periodic reports

After an enterprise is listed, the carrier used to disclose information is its periodic report. Periodic reports of enterprises are usually divided into annual reports, interim reports and quarterly reports. Among them, the annual report shall be completed and disclosed within 4 months from the end of each fiscal year, the interim report shall be completed and disclosed within 2 months from the end of the first half of each fiscal year, and the quarterly report shall be prepared and disclosed within 1 month after the end of the third and ninth months of each fiscal year.

The regular contents to be disclosed in the annual report include: basic information of the company; Main accounting data and financial indicators; The company's stock and bond issues and changes; At the end of the reporting period, the total amount of stocks and bonds, the total number of shareholders, and the holdings of the top 10 shareholders of the company; Shareholders holding more than 5%, controlling shareholders and actual controllers; The employment status of directors, supervisors and senior managers, changes in shareholding and annual remuneration; Board report; Management discussion and analysis; Significant events during the reporting period and their impact on the company; Full text of financial accounting report and audit report.

The regular contents to be disclosed in the interim report include: basic information of the company; Main accounting data and financial indicators; The issue and change of the company's stocks and bonds, the total number of shareholders, the shareholding of the top 10 shareholders of the company, and the changes of the controlling shareholders and actual controllers; Management discussion and analysis; Major litigation, arbitration and other major events during the reporting period and their impact on the company; Financial accounting reports.

The regular contents to be disclosed in the quarterly report include: basic information of the company; Main accounting data and financial indicators.

(3) Interim report

After the issuance of securities of a listed company, in addition to the preparation of periodic reports, major events that may have a greater impact on the trading price of the listed company's securities and its derivatives should also be disclosed through the preparation of interim reports. General interim reports are required to describe the cause of the incident, its current status and possible effects.

The above major events mainly include: major changes in the company's business policy and business scope; The company's major investment behavior and major decision to purchase property; The company enters into important contracts that may have a significant impact on the company's assets, liabilities, rights and interests and operating results; The company defaults on major debts or fails to pay off major debts due, or incurs a large amount of compensation liability; The company suffers major losses or major losses; Major changes in the external conditions of the company's production and operation; Change of directors, more than one-third of supervisors or managers of the company; The chairman or manager is unable to perform his duties; If a shareholder or actual controller holds more than 5% of the shares of the company, his holding of shares or control of the company has changed significantly; The company's decision on capital reduction, merger, division, dissolution and filing for bankruptcy; Or enter into bankruptcy proceedings according to law and be ordered to close down; Major litigation and arbitration involving the company; The resolutions of the general meeting of shareholders or the board of directors are revoked or declared invalid according to law; The company is investigated by competent authorities for suspected violations of laws and regulations, or is subject to criminal penalties or major administrative penalties; The directors, supervisors and senior managers of the company are investigated or taken compulsory measures by the competent authorities for violating laws and disciplines; Newly published laws, regulations, regulations and industry policies may have a significant impact on the Company; The board of directors adopts relevant resolutions on issuing new shares or other refinancing plans or equity incentive plans; Court rulings prohibit controlling shareholders from transferring their shares; More than 5% of the shares held by any shareholder of the company are pledged, frozen, judicial auction, trusteeship, set up trust, or the voting right is restricted according to law; The main assets are sealed up, seized, frozen or mortgaged or pledged; The main or all of its business has stopped; Providing material guarantees to foreign parties; Obtaining additional income such as large government subsidies that may have a significant impact on the company's assets, liabilities, equity or operating results; Change accounting policies and accounting estimates; Cases in which the information previously disclosed has errors, failure to disclose in accordance with regulations or false records, and is ordered to be corrected by the relevant authorities or corrected by the decision of the board of directors.

The above required disclosure content shall be disclosed strictly and timely, and any concealment or delay in disclosure will result in severe punishment by the administrative organ.

3. Information disclosure standards

Information disclosure should ensure that the content is true, accurate and complete, and there is no false record, misleading statement or major omission. Also ensure that the content is clear and concise, easy to understand, and can be understood by investors. As far as corporate information disclosure is concerned, we can usually judge from three aspects:

(1) Adequacy

That is, whether the content disclosed by the enterprise contains all the information that has a significant impact on the investment decision of the investor, and whether the degree of disclosure reaches the level necessary for the investor to make the investment decision. The sufficiency here is for investors, that is, as long as all factors affecting investors' investment should be fully publicized.

(2) Consistency

The disclosure content of the enterprise should be consistent with the actual situation, and the contents of multiple disclosure documents should ensure that there is internal logic between each other and can be confirmed.

(3) Intelligibility

The disclosure content of the enterprise should ensure that it is concise and easy to understand, prominent, logical, easy for general investors to read and understand, and should be combined with the characteristics of the enterprise's own targeted information disclosure.

Second, the components and consequences of the violation of enterprise information disclosure

According to the provisions of Article 85 and Article 197 of the new Securities Law, where an information disclosure obligor fails to disclose information in accordance with regulations, or there are false records, misleading statements or major omissions in the securities issuance documents, periodic reports, interim reports and other information disclosure materials announced, resulting in losses for investors in securities trading, The information disclosure obligor shall be liable for compensation; The controlling shareholders, actual controllers, directors, supervisors, senior managers and other directly responsible personnel of the issuer, as well as the sponsors, underwriting securities companies and their directly responsible personnel, shall bear joint and several liability for compensation with the issuer, except those who can prove that they are not at fault.

If the information disclosure obligor fails to submit the relevant report or fulfill the information disclosure obligation in accordance with the provisions of the Securities Law, it shall be ordered to make corrections, given a warning, and imposed a fine of not less than 500,000 yuan but not more than 5 million yuan; The persons directly in charge and other persons directly responsible shall be given a warning, and a fine of not less than 200,000 yuan but not more than two million yuan shall be imposed. Where the controlling shareholder or actual controller of the issuer organizes or instils the aforesaid illegal acts, or conceals relevant matters to cause the aforesaid situation, a fine of not less than 500,000 yuan but not more than 5 million yuan shall be imposed; A fine of not less than 200,000 yuan but not more than two million yuan shall be imposed on the persons in charge who are directly responsible and other persons who are directly responsible.

Where there are false records, misleading statements or major omissions in the reports or information disclosed by information disclosure obligors, corrections shall be ordered, a warning shall be given, and a fine of not less than 1 million yuan but not more than 10 million yuan shall be imposed; The persons in charge directly responsible and other persons directly responsible shall be given a warning, and a fine of not less than 500,000 yuan but not more than 5 million yuan shall be imposed. Where the controlling shareholder or actual controller of the issuer organizes or instils the aforesaid illegal acts, or conceals relevant matters and leads to the aforesaid situation, a fine of not less than one million yuan but not more than ten million yuan shall be imposed; A fine of not less than 500,000 yuan but not more than 5 million yuan shall be imposed on the persons directly in charge and other persons directly responsible.

【 Case Study 】

On November 7, 2015 (Saturday), Great Wisdom Company issued an announcement on the receipt of the China Securities Regulatory Commission's Prior Notice of Administrative Punishment and Market Entry Ban. The announcement said that on November 5, 2015, the company received the Notice of Administrative Punishment and Market Ban issued by the China Securities Regulatory Commission (number: Penalty word [2015] No. 147). The main contents include: Great Wisdom Company's suspected violation of securities laws and regulations has been investigated by the China Securities Regulatory Commission, and the suspected illegal facts are as follows: 1. In 2013, it was suspected of having confirmed the income of committed policies in advance of 87,446,901.48 yuan; 2. In 2013, marketing in the name of "playing new products" was suspected of falsely increasing sales revenue by 2,872,486.68 yuan; 3. Allegedly using the framework agreement with the advertising company to falsely increase the 2013 income of 933,400 yuan; 4. Delayed recognition of the 2013 year-end bonus reduces the accrued cost expense by 24,954,316.65 yuan; 5. Suspected of falsely increasing 2013 income by 15.67774 million yuan through fictitious business contracts; 6. The subsidiary is suspected of merging Tianjin Mintai in advance, affecting the total profit of the consolidated statement of 8,250,098.88 yuan and the goodwill of 4,331,301.91 yuan. The China Securities Regulatory Commission intends to decide to order the company to correct, give it a warning, impose a fine of 600,000 yuan, and punish those directly responsible.

From February 28, 2014 to November 6, 2015, Plaintiff Chen Guoxin first bought Great Wisdom shares on April 2, 2015, accumulating 108,300 shares for a total purchase of $1,464,777 and selling 102,400 shares for a total sale of $1,315,844. As of November 6, 2015, the plaintiff still held 5,900 shares of Great Wisdom, based on which the average purchase price was 25.24 yuan/share. During the period from November 7, 2015 to November 10, 2015, the plaintiff sold 5,900 shares of Great Wisdom Stock, with a total selling price of 98,464 yuan, based on which the average selling price is 16.69 yuan/share. The standard commission for trading stocks in the Plaintiff's securities account is three thousandths of the transaction amount.

The court held that false statements in the securities market refers to the behavior of information disclosure obligors who violate securities laws and regulations and make false records or misleading statements about major events that go against the truth in the process of securities issuance or trading, or major omissions or improper disclosure of information when disclosing information. At present, the China Securities Regulatory Commission has made an administrative penalty decision, finding that the defendant Great Wisdom Company has constituted an illegal act of disclosing information with false records as described in the first paragraph of Article 193 of the Securities Law, and has imposed administrative penalties on Great Wisdom Company. Therefore, in combination with the provisions of Article 17 of the Supreme People's Court on the Trial of Civil Compensation Cases caused by False Statements in the Securities Market (hereinafter referred to as "Certain Provisions") and the above administrative punishment decision, the court held that Great Wisdom Company had falsely recorded false statements in the securities market, and the date of implementation of its false statements was February 28, 2014. The date of the 2013 Annual report.

Corporate information disclosure has always been the focus of the Securities Law. The violation of enterprise information disclosure not only means that the enterprise will face the administrative punishment of the CSRC, but also means that the majority of shareholders' claims will follow. Before the introduction of the "Nine Min Ji", listed companies could still effectively defend whether their undisclosed information affected the stock trading of shareholders, but after the "Nine Min Ji", the punishment for illegal disclosure of listed companies has become more severe, and at the same time, the burden of proof of shareholders has been reduced. As long as the CSRC imposes penalties on the listed companies, it will be a very certain result that the listed companies bear the loss of the shareholders' investment difference. This case is a bellwether of securities misrepresentation lawsuits. In this case, Great Wisdom Company falsely increased its operating income, constituting securities misrepresentation, and should be liable for compensation of shareholders' investment difference losses. The characteristic of this case is that the compensation ratio of the liability is 100% of the loss of the shareholders, that is, systemic risk is not added in the loss calculation process to reduce the compensation amount of the listed company. It can be said that the case has affected the overall wind of shareholder rights litigation after 2018. Nowadays, listed companies will face more and more severe punishment for information disclosure violations.