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A) articles 11 and 12 as well as the implementation of the U.S. Securities and Exchange Commission Rule 10 (b) -5 on the provisions of Article .

SA Article 11 subsection (a) expressly provides that when the registration statement on the situation untrue statement or material omission , "Unless proved in acquiring securities, ( the purchaser ) is known to untrue or false negative circumstances" otherwise, " any person access to such securities " available under section 11 proceedings. Thus suffices to show that the plaintiff : first, the registration documents significant false statements or omissions ; Second, he suffered a loss ; rather than rely on the documents to prove that he would not have to prove that he received the file. However, if the plaintiff is in the issuer's registration documents published since the effective date of 12 months after the purchase of the stock loss specification , the plaintiff must prove the existence of the trust on the registration documents , but he still needs to prove once read the file because the article also stipulates that investors are not necessarily establish trust him to read the registration statement . So the first 11 generally does not require the plaintiff to prove that the trust , which also provides for the defendant even though the plaintiff in the Securities can be based on facts known at the time the grounds of defense , but the defense establishment is quite difficult .

SA provisions of Section 12 of Article 11 is to complement and extend . SA Article 11 applies only under the Act for the registration of securities through the issuance and sale , and the first 12 will be extended to civil liability for misrepresentation of the issuance and sale of any securities , regardless of whether the securities are carried out under the Securities Act registration . As mentioned above, in accordance with Article 11 Prosecution , if the plaintiff in obtaining registration documents from the entry into force of the securities has been over 12 months, and the issuer has published instructions through profit or loss for the period , then he will trust for false statements the burden of proof , and if the prosecution under section 12 of SA , the plaintiff need not prove completely the existence of the trust , as long as he shows that there is not known in advance to false statements and the plaintiff ( whether or experienced ) outside except by virtue of its knowledge , no obligation to conduct additional investigations . Based on the above distinction , in practice most investors pursuant to section 12 proceedings , rather than pursuant to section 11 .

In addition, " the Securities Exchange Act of 1934 " (Securities Exchange Act of 1994, hereinafter referred to as SEA) Article 18 also made a false statement related to the issue of compensation requirements, but this provision does not apply to the case did not disclose , and if statements -making is based on good faith and do not know its untrue statements , they can get a defense , especially plaintiff must prove misrepresentation relationship of trust , which is not in accordance with the terms of litigation than in accordance with the general rules of tort litigation has much advantage .

According to SEA Section 10 (b) of the authorization , the U.S. Securities and Exchange Commission entitled in the public interest and the interest of investors to devel