Liu Guixiang, vice ministerial level full-time member of the judicial committee of the Supreme People’s court, said in a series of live media interviews on the interpretation of the “work report of the Supreme People’s court” of the 2022 national two sessions held on March 10 that at the end of February this year, the Standing Committee of the National People’s Congress made the “decision on the establishment of Chengdu Chongqing financial court”, marking that after the establishment of Shanghai financial court and Beijing Financial court, The country’s third special financial court is ready. According to the requirements of the decision, the Chengdu Chongqing financial Court exercises centralized jurisdiction over financial cases within the twin city economic circle of Chengdu Chongqing region.
According to Liu Guixiang, in 2021, 732 bankruptcy and reorganization cases were concluded by the national courts, and 1.5 trillion yuan of assets were revitalized. He stressed that we should strengthen the financial trial work and prevent the financial from “departing from reality to falsehood”.
reduce the cost of safeguarding the rights of small and medium-sized investors according to law
increase the illegal cost of securities fraudsters
Liu Guixiang said that reducing the rights protection cost of small and medium-sized investors according to law and increasing the illegal cost of securities fraudsters according to law are the focus of securities trials.
In terms of reducing the cost of rights protection, Liu Guixiang introduced that on the basis of establishing the diversified resolution mechanism and model judgment mechanism of securities disputes in the early stage, the supreme law introduced the judicial interpretation of securities representative litigation at the first time after the revision of the securities law, and supported small and medium-sized investors to “free ride” rights protection through ordinary representative litigation and special representative litigation at the level of legal system. After the issuance of the judicial interpretation, the Shanghai financial Court concluded the case of 315 investors including the plaintiff Wei V Shanghai Feilo Acoustics Co.Ltd(600651) Securities Misrepresentation dispute, and the shareholders received a compensation of 390000 yuan per capita, which is the first comprehensive practice of ordinary representative litigation. At the same time, last year, Guangzhou intermediate people’s court also concluded the class action case of Securities Misrepresentation dispute.
In terms of increasing illegal costs, Liu Guixiang introduced that the supreme law revised and reissued the judicial interpretation of Securities Misrepresentation in January this year, which has two important contents: first, it abolished the pre prosecution procedure, that is, the prosecution and acceptance of Securities Misrepresentation, and is no longer subject to administrative punishment by the regulatory authorities; Second, it clearly stipulates that “chasing the first evil” and “fighting accomplices” should be carried out at the same time. If the controlling shareholder and actual controller organize and instigate the financial fraud of the listed company, the relevant controlling shareholder and actual controller shall be ordered to directly bear the liability for compensation to the investors, that is, the civil subject who helps the fraud should also bear the corresponding civil liability, so as to lay a solid net of legal liability for the “first evil” and “accomplice”.
“We also vigorously strengthen the professional construction of financial trials, ensure the implementation of the national financial strategy with high-quality financial trials, and promote the reform of the financial system.” According to Liu Guixiang, at the end of February this year, the Standing Committee of the National People’s Congress made the decision on the establishment of Chengdu Chongqing financial court, marking the imminent emergence of the third special financial court in China after the establishment of Shanghai financial court and Beijing Financial court. “In accordance with the requirements of the decision, the Chengdu Chongqing financial Court exercises centralized jurisdiction over financial cases within the twin city economic circle of Chengdu Chongqing region, that is, cross provincial jurisdiction over financial cases. This is undoubtedly another measure to strengthen the construction of the financial trial system and improve the quality and efficiency of financial trials.”
strengthen the financial trial work to prevent the financial “from disenchantment to falsehood”
Liu Guixiang said that financial trial is very important in building a legal business environment. To strengthen the financial trial work, the people’s court should give full play to the trial function, standardize and guide the financial “blood” to better nourish the real economy, prevent the financial “from disenchantment to falsehood”, and reduce the financing cost.
In addition, Liu Guixiang said that last year, courts across the country concluded 1.55 million financial, civil and commercial cases. In terms of law application, we should earnestly implement the priority protection requirements for special market subjects, and give special protection to relatively vulnerable parties such as financial consumers based on special provisions of the law.
Liu Guixiang also said that in terms of rights protection procedures, the supreme law has established a diversified resolution mechanism for financial disputes based on reducing the cost of rights protection. We strengthened the connection between industrial mediation and judicial work, and jointly with the people’s Bank of China, the China Banking and Insurance Regulatory Commission and the China Securities Regulatory Commission, achieved full coverage of the litigation and mediation docking mechanism for banking, insurance and securities disputes. In 2021, local courts entrusted the 66 thousand cases of pre mediation cases by the CIRC, and the success rate of mediation reached as high as 65%.
2021: 732 bankruptcy reorganization cases concluded by national courts
Liu Guixiang said that in 2021, the national courts concluded 732 bankruptcy and reorganization cases, revitalized assets of 1.5 trillion yuan, helped 745 promising enterprises extricate themselves from difficulties and reborn, and 350000 employees stabilized their jobs, which fully reflects the important function of bankruptcy and reorganization to protect the main body of the market and employment.
Liu Guixiang pointed out that the Supreme People’s court has always attached great importance to the bankruptcy trial work, and new progress was made in the bankruptcy trial work of courts across the country last year. By improving the level of specialization and informatization in the trial of bankruptcy cases, the number of closed cases has been significantly increased. In 2021, more than 16000 cases were received and 12000 cases were closed, with an increase of more than 20%. The trial cycle of cases was significantly reduced from an average of 577 days in 2017 to 157 days, a decrease of 420 days.
“In terms of the concept of case trial, we have always emphasized the simultaneous development of ‘active rescue’ and ‘timely liquidation’.” He said: on the one hand, enterprises without business prospects should be allowed to withdraw from the market in an orderly manner through bankruptcy liquidation, timely release and revitalize economic factors and resources, and save judicial resources and public management resources; On the other hand, give full play to the functions of bankruptcy reorganization and bankruptcy reconciliation system, and timely save troubled enterprises with development prospects.
