Recently, Nanjing King-Friend Biochemical Pharmaceutical Co.Ltd(603707) received the decision of Jiangsu securities regulatory bureau to take corrective measures, and the chairman and Secretary of the company received the decision of Jiangsu securities regulatory bureau to issue a warning letter. The reasons include that related party transactions did not perform the review procedures and did not disclose as required, etc. The author believes that the directors, supervisors and senior managers of listed companies should strengthen their understanding of the concept of “transaction” so as not to touch the red line of laws and regulations.
On August 12, 2020, Nanjing King-Friend Biochemical Pharmaceutical Co.Ltd(603707) transferred 40 million yuan to Jianzhi polymerization, which will be transferred back the next day. Nanjing King-Friend Biochemical Pharmaceutical Co.Ltd(603707) Huang Xiwei, the director and Secretary of the board of directors, actually controlled Jianzhi polymerization. The securities regulatory bureau determined that the above-mentioned capital transactions were related transactions, but the company did not perform the related transaction review procedures as required and did not disclose them in the 2020 annual report. In addition, on August 3 this year, the company said in the letter Phi that one of the partners of jiansi information and Jianli information was Huang Xiwei, and both enterprises were related parties of the company; The CSRC believes that the basis is insufficient and the letter phi is inaccurate.
It should be said that Nanjing King-Friend Biochemical Pharmaceutical Co.Ltd(603707) two violations are not too big problems. It is disclosed that the reason for transferring 40 million yuan is to maintain the cooperative relationship between the listed company and the bank; In addition, the management of the company believes that the transfer does not belong to any situation of connected transactions, and there is no transaction purpose and essence.
There seems to be no direct definition of what is a “transaction” of a listed company in laws, regulations and listing rules. However, Article 9.1 of the stock listing rules of the Shanghai and Shenzhen Stock Exchange stipulates that the “transaction” includes 11 types of matters, namely, the purchase or sale of assets, foreign investment, the provision of financial assistance, the provision of guarantee, the lease in or lease out of assets, the entrusted or entrusted management of assets and businesses, the donation or receipt of assets, the reorganization of creditor’s rights and debts, the signing of license agreement Transfer or transfer research and development projects and other transactions recognized by the bourse. It can be said that the “trading” of listed companies is not limited to barter and target trading in real life, but is all inclusive.
In addition, the concept of connected person (including connected legal person and connected natural person) and connected transaction are also stipulated in the stock listing rules. Affiliated natural persons include natural persons holding more than 5% of the shares of listed companies, directors and supervisors of listed companies. The so-called related party transactions refer to the transfer of resources or obligations between listed companies or holding subsidiaries and related parties. The scope of related party transactions includes the above-mentioned “transactions”, and on this basis, it also includes “joint investment between listed companies and related parties”.
In retrospect, if it is necessary to define the “transaction” of listed companies, the author may wish to give a superficial concept based on the definition of related party transactions, that is, the matters that may cause the transfer of the underlying resource property rights or other obligations and the change of the rights and interests of listed companies with other market subjects can be included in the category of “transaction”.
The stock listing rules of the stock exchange stipulate the mandatory disclosure and deliberation system of the general meeting of shareholders for the transactions of listed companies with a certain volume or more; For related party transactions, due to concerns about the transfer of interests and other behaviors, the exchange has reduced the threshold of compulsory letter phi and deliberation at the general meeting of shareholders. Its purpose is to protect the legitimate rights and interests of listed companies and public shareholders through the effective supervision of public shareholders.
The principles and guidance of stock listing rules formulated by the exchange are obviously based on the basic position of safeguarding the overall interests of listed companies and the interests of all shareholders, which is an inevitable requirement for safeguarding the three principles of the market and maintaining the sustainable development of the securities market. However, the listed company and its directors, supervisors and senior executives in this case have too narrow understanding of “transaction”, especially based on the standard concept and did not consider the problem from the public perspective. They believe that before the transfer of RMB 40 million, the company temporarily controls the bank key gathered by Jianzhi, which can prevent all risks, but from the public perspective, risks are still everywhere, Who can guarantee that there will be no problem in any link, and there will be no suspicion of interest transmission?
For related party transactions, it is not wrong for listed companies to proceed from the principle of prudence, strictly identify related parties, and follow the rules to disclose or follow the deliberation procedures of the general meeting of shareholders. Listed companies will not incur any losses and will only benefit from them. For example, in this case, Huang Xiwei is the limited partner of jiansi information and Jianli information. The author believes that it is debatable to exclude jiansi information and Jianli information from the affiliates of the listed company on the grounds that the limited partnership is a partnership business executed by the general partner.
For example, a limited partner holds 99% of the share of the limited partnership and accounts for the majority of the enterprise’s profit distribution. If the above reasons work, the directors and supervisors can participate in the limited partnership and then conduct interest transfer transactions with listed companies, which will lead to a breach of the levee system.
(Daily Economic News)
