CSRC Unveils 12 Key Missions for Reform of Chinese Capital Markets


China’s securities regulator has unveiled plans for the country’s capital markets.

From 9 to 10 September the China Securities Regulatory Commission (CSRC) convened its work meeting on “comprehensively deepening capital market reforms.”

According to CSRC’s official website the meeting outlined a total of 12 key missions for the reform of China’s capital markets in the near-future, including:

  1. Fully utilising the role of the STAR Market board as field for experimentation – upholding the positioning of the STAR Market Board, optimising approval and registration integration mechanisms, and maintaining the vigour of reform.
  2. Vigorously driving increases in the quality of listed companies – formulating action plans for implementing and driving increases in the quality of listed companies; pragmatically controlling the entry and exit passes. Strictly controlling the IPO approval quality gateway, fully utilising the role of capital market acquisitions and restructurings, and clearing out diversified market withdrawal channels.
  3. Making up the shortcomings in China’s multi-tier capital markets system – driving reform of the venture board, accelerating reform of the New Third Board, and selecting several regional equity markets for undertaking systemic and operational innovation trials.
  4. Vigorously driving the creation of intermediary institution capability – accelerating the establishment of high-quality investment banks, improving diversified regulatory measures, supporting innovation and quality increases by high-quality brokerages, and encouraging the specialised development of small and medium-sized brokerages.
  5. Accelerating the high-level opening of capital markets -implementing opening measures that have already been publicly announced, maintaining financial security within an open environment.
  6. Driving the entry of more medium and long-term funds into the market – strengthening the long-term performance guidance of securities funds operators, and advancing category-based regulation of publicly offered fund managers.
  7. Pragmatically resolving risk in key areas including stock pledging, bond defaults and privately offered funds;
  8. Further expanding rule of law – accelerating amendments to the “Securities Law” (证券法) and the “Criminal Law” (刑法), and greatly raising the cost of legal breaches, including fraudulent issuance, false information disclosures by listed companies and the provision of false documentation by intermediary organisations.
  9. Strengthening of investor protections – driving the establishment of a securities collective litigation system with Chinese characteristics, and exploring the establishment of systemic mechanisms for administrative penalties and confiscations which are preferentially applied to remedies for investors.
  10. Raising the effectiveness of investigation and enforcement – strengthening level-based, case-based management of cases, and focusing resources on investigation of major cases of fraud. Raising the efficiency of the investigation and handling of cases;
  11. Vigorously driving administrative simplification and delegation of authority. Greatly refining examination, approval and filing items, optimising examination, approval and filing procedures, and raising the transparency of administration.
  12. Accelerating increases in regtech capability. Driving in-depth integration of technology and operations, and raising teh tech and smart-level of regulation.