Determination of"Materiality"in Securities False Statements from a Comparative Perspective
Securities false statements can severely infringe upon investors'legitimate rights and interests,represen-ting a typical form of violation in the capital market.The"Several Provisions on Hearing Civil Compensation Cases of Securities Market False Statements"issued at the beginning of 2022 establish the necessity of"materiality"in the false statements of the obligors for the establishment of civil compensation liability.This underscores the signifi-cant status of the"materiality"requirement.Currently,China faces two main issues in determining the"materiali-ty"of false statements:the dualism in legislation and the lack of uniform standards in judicial determination.By analyzing the differences in the basic content and concepts of the two major standards of"materiality"and reflecting on the current state of judicial rulings in disputes over liability for false statements through recent case studies,this paper ultimately suggests improvements for the determination of"materiality"in securities false statements in Chi-na.Specifically,it proposes that the courts should clearly have the authority to independently review the"material-ity"requirement.In terms of specific determination standards,the"Price Sensitivity Standard"should be applied cautiously,and the compensatory role of the"Investor Decision Standard"should be emphasized.
false statementmaterialityPrice Sensitivity StandardInvestor Decision Standard
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