As a landmark case in the bond market, the progress of the "Wuyang bond" case has been highly concerned by all parties.
On January 18, Shanghai jintiancheng law firm issued a letter of complaint to clients to urgently respond to market rumors that was executed by the court for 650 million yuan.
This Clarification Announcement brought to the surface the latest progress of the "Wuyang debt" case - the case entered the stage of property execution after the completion of the judgment. It is understood that 650 million yuan is actually the total loss compensation in the "Wuyang bond" case. The law firm shall bear joint and several liability for the relevant losses of the "Wuyang bond" bondholders within 5%.
urgent clarification
On January 18, according to the relevant information of China executive information disclosure network, Shanghai jintiancheng law firm was executed and filed 12 cases by Hangzhou intermediate people's court, with a cumulative amount of 650 million yuan.
Subsequently, jintiancheng law firm urgently issued the letter to clients, saying:
according to the judgment, the exchange shall be jointly and severally liable for the relevant losses of the bondholders of "Wuyang bond" within 5%, which is not the "650 million yuan" rumored in the market (in fact, it is the total loss compensation);
"Wuyang debt" case has limited impact on the financial situation of the Institute. At present, all businesses of the Institute are carried out normally, and the practice of all business personnel is normal and orderly, which has no material impact on the sustainable operation;
after the judgment of the second instance came into force, the exchange has always maintained effective communication with the enforcement court, and has taken the initiative to perform part of the payment, without being enforced by the court for refusing to perform the judgment;
for false information, the exchange has sent a letter to China executive information disclosure network to apply for correction of the execution amount.
According to insiders, deppon securities, Daxin certified public accountants, jintiancheng law firm, Dagong international and other intermediaries that bear joint and several liability for the relevant losses of bondholders in the "Wuyang bond" case promised to pay 200 million yuan, 45 million yuan, 10 million yuan and 1.5 million yuan respectively before January 15.
long way to protect rights
The case stems from the fraudulent issuance of two issues of "Wuyang bonds" in 2015.
In August 2015, Wuyang Construction issued 1.36 billion yuan of corporate bonds in two phases, namely "15 Wuyang bonds" and "15 Wuyang 02".
In August 2017, Wuyang construction defaulted on its debt, and the CSRC announced that it would file a case for investigation, and the "construction enterprise aircraft carrier" collapsed. Since then, "Wuyang bond" investors have embarked on the road of safeguarding their rights.
On July 6, 2018, the Certificate Committee issued a decision on administrative punishment against Wuyang construction, which showed that Wuyang construction defrauded the approval of corporate bond issuance with false declaration documents.
On December 31, 2020, Hangzhou intermediate people's court made a judgment of first instance on the dispute over the liability for Securities Misrepresentation brought by the bondholders against Chen Zhizhang, the actual controller of Wuyang construction and Wuyang construction, as well as Debang securities, Daxin accounting office, jintiancheng law firm and Dagong international.
new starting point of intermediary responsibility
Market participants said that the "Wuyang debt" case caused a sensation in the market and sounded an alarm about the non-standard and even irresponsible behavior of intermediaries.
Huatai Securities Co.Ltd(601688) the fixed income team believes that in practice, it is still difficult to obtain evidence, provide evidence and litigation such as fraudulent issuance and financial fraud. Even if the lawsuit is won, most of the compensation is far lower than the investment loss, and the investors are still in a relatively weak position.
with the improvement of the rule of law in the bond market, the responsibilities of all participants in the market are becoming more and more clear. It is necessary for the lead underwriters and intermediaries to be more diligent and dutiful in performing their respective responsibilities. The model of seizing the bond business by relying on low price "walking volume" may face greater risks.
However, the boundary of intermediary responsibility still needs to be rationally defined. There is no doubt that diligence needs to be strengthened; However, intermediary responsibility has its boundaries, otherwise it will eventually react on the financing cost and restrict the enthusiasm of business development and market development.
Yao Yu, founder of YY rating, believes that the "Wuyang bond" case has entered the implementation stage, and intermediaries have expected it. "The financial statements of Debang securities have made loss provision in previous years." He said.
As a lawyer with rich litigation experience in handling bond default cases, Ma Jianrong, partner of Guantao Zhongmao law firm, believes that the "Wuyang bond" case has attracted much market attention. First, Hangzhou intermediate people's court filed a case before the CSRC punished the intermediary. "generally, misrepresentation and fraudulent issuance require administrative punishment from the CSRC first." He said.
second, the case adopted the model of class action, which was innovative at that time.
On July 15, 2020, the Supreme People's Court issued the minutes of the Symposium on the trial of bond dispute cases by national courts. The summary said that for the trial of bond fraud issuance and false statement cases, we should strictly implement the verification and check responsibility of bond underwriting institutions and bond service institutions to protect the interests of investors in accordance with the provisions of the securities law, and combine the responsibility with the degree of fault. If a bond underwriting institution and a bond service institution fail to perform the obligation of special care for their respective professional business matters and fail to perform the obligation of ordinary care for other business matters, they shall be ordered to bear corresponding legal liabilities.
Market participants said that the minutes gave clear standards for the fault identification and exemption defense of bond underwriting institutions.
Referring to the reference value of this case for future bond default litigation, Ma Jianrong believes that this is the first case of judicial practice after the release of the minutes of the symposium. According to his understanding, after that, there were several judgment cases of Shanghai financial court and Beijing Financial court, but the proportion of intermediaries to bear losses in these cases decreased significantly.
"The court will also balance the proportion of responsibilities that intermediaries should bear. Breach of contract itself is more corporate responsibility. It may be unfair to let intermediaries bear all responsibilities." He said.
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