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August 22, 2019

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Financial court celebrates 1st birthday

The Shanghai Financial Court has accepted more than 6,600 cases worth a total of more than 110 billion yuan (US$15.7 billion) in the past year, the court said at its first anniversary summary yesterday.

The majority of cases were related to loans, leases, corporation bond trading and pledged securities repurchases.

It said it handled the country’s first case of share transfers between a foreigner and a Chinese national entrusted by him to manage his shares.

In 2005, the two signed an agreement about the foreigner’s purchase of 880,000 shares of a company from the Chinese at 4.36 yuan for each share. The shares would be managed by the Chinese under the foreigner’s orders. The Chinese could exercise shareholder’s rights under his own name but the income should go to the foreigner.

In 2017, the company was listed on the Shanghai Stock Exchange. As a shareholder, the Chinese made statements several times that he didn’t hold any shares for others.

Last year the company gave each shareholder a cash dividend of 4 yuan per 10 shares and an extra four shares per 10 shares.

Later the two sides were in dispute. The court ordered the two sides to negotiate. If they failed to reach an agreement, the foreigner could apply to sell or auction the shares and get back more than 3.8 million yuan for his investment. He could take 70 percent of the extra and the Chinese the remaining 30 percent.

The Chinese was also ordered to pay the foreigner 70 percent of the 352,000-yuan cash dividend he got in 2017.




 

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