Evergrande onshore unit says it’s being probed by China watchdog

THE mainland China unit of giant developer China Evergrande Group said that the country’s securities regulator has built a case against it relating to suspected information disclosure violations.

Hengda Real Estate Group said late on Wednesday (Aug 16) that it received a notification earlier the same day from the China Securities Regulatory Commission (CSRC).

The struggling real estate developer unveiled the news in a Shanghai Stock Exchange filing.

CSRC probes into alleged information disclosure irregularities aren’t rare. Among the 73 domestically listed Chinese companies under investigation as at Jul 18, more than 70 per cent were suspected of information disclosure violations, local media reported last month.

Targets have also included state-owned giants. China Shipbuilding Industry and Beijing Capital Development said last month that they were subject to CSRC investigation over suspicions they violated information-disclosure rules.

A probe doesn’t necessarily lead to penalties, according to law firm King & Wood Mallesons. But if that’s the case, administrative punishments may include rectification, warning or fines.

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Hengda will actively cooperate with the CSRC in its investigation and fulfil its disclosure obligations, the company added in the statement on Wednesday. BLOOMBERG