Advances in Economics, Management and Political Sciences

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Proceedings of the 2023 International Conference on Management Research and Economic Development

Series Vol. 26 , 13 September 2023


Open Access | Article

Deficiencies of the Allocation Mechanism of Target Company's Anti-Acquisition Decision Rights under the Chinese Shareholder Primacy

Yifan Chen * 1
1 Kunming University of Science and Technology

* Author to whom correspondence should be addressed.

Advances in Economics, Management and Political Sciences, Vol. 26, 364-372
Published 13 September 2023. © 2023 The Author(s). Published by EWA Publishing
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Citation Yifan Chen. Deficiencies of the Allocation Mechanism of Target Company's Anti-Acquisition Decision Rights under the Chinese Shareholder Primacy. AEMPS (2023) Vol. 26: 364-372. DOI: 10.54254/2754-1169/26/20230598.

Abstract

With the continuous deepening of China's market economy system reform, corporate acquisitions, especially hostile acquisitions, are becoming increasingly popular. Therefore, there is an urgent need for the market to improve the relevant legal provisions for anti-takeover decisions and measures. To begin with, this article takes the allocation of anti-acquisition decision-making right from the perspective of comparative law as an index. Then, it sorts out the decision-making models and related measures of anti-hostile acquisitions. Subsequently, this article takes the equity dispute between China Vanke Co., Ltd. and Baoneng Investment Group Co as a case study, using literature research methods and qualitative analysis methods as the basic research approaches to explore various practical difficulties faced by Chinese companies in anti-hostile acquisitions under the shareholder primacy. This refers to the limitations of the legislative design of the relevant shareholder primacy for Chinese listed companies in the face of hostile acquisitions, which include an analysis of the implementation authority of acquisition defense measures, the responsible parties, and the reasons for the insufficient power of the board in anti-hostile acquisition activities. Ultimately, in order to overcome the above deficiencies, this article proposes suggestions on limiting the power of shareholders' meetings to expand the function of the board, improving the mechanism for the operation of directors' powers and responsibilities, balancing the overall rights and protecting interests of shareholders.

Keywords

anti-acquisition, shareholders primacy, anti-acquisition decision rights

References

1. Lin Shufang. (2012) The development of hostile takeover in China from a legal perspective. Fudan University, 9-10.

2. Zhao,Y. (2009) Debate on Modern American Corporate Governance Theory of Board Centered Theory and Shareholder Centered Theory. Journal of Comparative Law, 4,96-97.

3. Su,L. (2018) Research on Legal issues of ownership of anti-takeover decision-making Right of Listed companies. Fuzhou University,33-34.

4. Catan, E.,Kahan,M. (2015) The Law and Finance of Anti-Takeover Statutes.SSRN Electronic Journal, 68(3),629-630.

5. Petrin, M.,Moore,M. (2017) Corporate Governance: Law, Regulation and Theory. Palgrave Macmillan,289-290.

6. Zeng,Q.Y. (2012) Ownership of the Decision of Anti-takeover Decision of the Target Company. Journal of Jurisprudence,6-7.

7. Zheng,J.N. (2014) Research on the Fidelity Obligation of Target Company Directors in Company Acquisitions. Journal of China University of Political Science and Law, 44 (06),88-89.

8. Feng,J. (2016) The Limitations of Shareholder Centered Theory from the Perspective of the 'Wanbao Dispute'. Huazhong University of Science and Technology, 20-24.

9. He Shucen. (2018) The Dilemma and Overcoming of shareholders Dominant Model in Anti-hostile acquisitions. Hunan Normal University,32-33.

10. Zeng,X.S. (2022) The Dilemma and Countermeasures of Director Responsibility Regulation: From the Perspective of Individual Differences in Directors. Journal of Law,43(06):102-116.

11. Wang,C.B (2012) On the Improvement of the Anti-Takeover Legal System of Listed Companies in China. Northeastern University of Finance and Economics,29-30.

12. Easterbrooke, F.H., Fische.D.R. (2011) The Economic Structure of Corporate Law. Cambridge University Press,163-164.

13. Liu,G.X., Wang,B.Q., Wang,B.P. (2014) Research on the Factors Influencing the Independence of Independent Directors and Governance Effectiveness:Evidence Based on Board Voting. Scientific Decision Making, 98(01),15-26.

14. Li,D.F. (2013) On the Supervision Law of Listed Companies.China University of Political Science and Law Press, 307.

Data Availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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Volume Title
Proceedings of the 2023 International Conference on Management Research and Economic Development
ISBN (Print)
978-1-915371-95-9
ISBN (Online)
978-1-915371-96-6
Published Date
13 September 2023
Series
Advances in Economics, Management and Political Sciences
ISSN (Print)
2754-1169
ISSN (Online)
2754-1177
DOI
10.54254/2754-1169/26/20230598
Copyright
13 September 2023
Open Access
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited

Copyright © 2023 EWA Publishing. Unless Otherwise Stated