China’s securities regulator issues draft of new short-swing trading rules
CHINA’S securities regulator on Friday (Jul 21) issued draft rules on improving regulation of short-swing trading transactions of specific investors, to limit insider trading.
Previous Chinese law requires company insiders such as board directors to return profits earned from short-term share trades to the company. The new rules would help clarify when those requirements apply.
“With the development of the capital market and the increasing variety of securities and trading methods, the aforementioned principle-based provisions are difficult to apply to various complex scenarios, and the necessity of introducing a specialised rule is becoming more and more apparent,” the regulator said.
The rules will not have an impact on trading by ordinary investors, it said.
The regulator said the move was conducive to standardising the supervision of short-term transactions of specific investors, stabilising market expectations, improving trading convenience, and enhancing the attractiveness of the A-share market.
The regulator will solicit opinions from public until Aug 20.
Major shareholders of many tech firms have recently offloaded shares amid recent upward swings in notably Chat-GPT related stocks in Chinese mainland markets.
Markets in China have been volatile over the past few weeks, roiled by a few months of rocky economic data, and unnerving investors. REUTERS
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