The Construction of Securities Public Interest Litigation System from the Perspective of Protecting Small and Medium Investors

Abstract

Securities violations have dual consequences, both damaging public and private interests. The emergence of securities public interest litigation can bridge the gap between "private remedies" and "public enforcement" in the governance paths. However, due to the lack of legal provisions and judicial practice, the establishment of the securities public interest litigation system and its operation need to be explored. This article, from the perspective of protecting small and medium investors, discusses the goals and challenges of constructing the securities public interest litigation system. It also examines the necessity of using public interest litigation to restrain the abuse of controlling shareholders' rights and protect the interests of small and medium investors. Regarding the obstacles faced by current securities public interest litigation, the main issues include the questionable legislative positioning and the need for clarity in specific procedures. In the process of exploring the construction of the securities public interest litigation system, this article focuses on discussing the scope of application of public interest litigation, the selection of suing entities, and the allocation of burden of proof. It aims to enhance the understanding of the public and relevant departments regarding the construction of the public interest litigation system, while highlighting its significant role in protecting the rights and interests of small and medium investors, effectively promoting the protection of public interests and the lawful performance of regulatory authorities in the securities market, and safeguarding the healthy development of the securities market.