Laws and Regulations
Administrative Measures for Information Disclosure of Listed Company
Article 1. These measures is formulated in accordance with the Company Law, the Securities Law and other relevant laws and administrative regulations for the purpose of regulating the process of information disclosure by the issuers, listed companies and other obligors responsible for information disclosure (hereinafter, referred to as disclosers), strengthening the administration of information disclosure and protect the legitimate rights and interests of investors.
Article 2. Information shall be disclosed truthfully, accurately, completely and timely. Any false representation, misleading statement or material omission is prohibited.
Disclosures shall be simultaneously and openly released by the discloser to all the investors.
Information disclosed abroad by a company that conducts securities and derivatives offerings and listed in both domestic market and abroad shall be simultaneously disclosed in the domestic market.
Article 3. The issuer and the directors, supervisors and senior managers of a listed company shall perform their duties diligently and in a good faith. They shall also ensure the truth, accuracy, completeness, timeliness and fairness of the disclosed information.
Article 4. Prior to disclosing any insider information in accordance with law, no insider may publicize or divulge such information or use it for insider trading.
Article 5. Disclosure documents shall mainly comprise share prospectuses, bond prospectuses, listing announcements, periodic reports and temporary reports.
Article 6. When information is disclosed in accordance with the law, the discloser shall also submit the draft of the announcement and other relevant reference documents to the stock exchange for registration, and publish them in the mass media designated by China Securities Regulatory Commission (hereinafter referred to as the “CSRC”).
No disclosers may publish any information on their company’s website or on any other mass media before such information is published in the designated mass media; No disclosers may replace their obligations to provide reports or announcements as they are expected to fulfill with conducting such acts as holing press conferences or answering to journalists’ questions, and no disclosers may replace the relevant temporary reports with periodical reports.
Article 7. Disclosers shall submit the draft of the announcements and other reference documents to the local securities regulatory bureau of the listed company’s registration place and make them available in the domicile of the company for public inspection.
Article 8. Disclosure documents shall be formulated in Chinese. In case there is any foreign language version, the discloser shall ensure the consistency of both versions. In case any discrepancy exists between them, the Chinese version shall prevail.
Article 9. The CSRC shall supervise the disclosure documents, the status of announcements，the management of the disclosure， as well as the conduct of the controlling shareholders, the de facto controllers and the disclosers in the process of disclosure.
Stock exchanges shall supervise the disclosure information of listed companies and other disclosers, urge them to disclose the information in a timely and accurate manner, and conduct a real-time monitoring on the trading of theirs securities and derivatives. Listing rules and other disclosure rules formulated by stock exchanges shall be submitted to the CSRC for approval.
Article 10. The CSRC may formulate special provisions on information disclosure for listed companies of special industries such as finance and real estate.
Chapter II Share Prospectus, Bond Prospectus and Listing Announcements
Article 11. Stock prospectuses formulated by the issuer shall conform to the relevant CSRC provisions and shall include all the information that might significantly impact investment decisions of investors.
Once the application for public securities offering is approved by the CSRC, the issuer shall publish the prospectus prior to initiating the corresponding securities offering.
Article 12. Directors, supervisors and senior management of the issuer shall sign written confirmation for the share prospectus and ensure the truth, accuracy and completeness of the disclosure information. Meanwhile, the prospectus shall bear the seal of the issuer.
Article 13. Where the issuer applies for initial public offering of shares, after the CSRC accepts the application and before the Public Offering Review Committee commences review, the issuer shall disclose the submission version of the prospectus in advance on the website of the CSRC.
The submission version of prospectus disclosed in advance shall not be considered as the official prospectus and shall not contain any price information. Meanwhile, the issuer shall not issue any stock on the basis of such draft
Article 14. Where any significant event occurs after the offering application is approved by the CSRC and before the offering term expires, the issuer shall submit a written report to the CSRC and shall, upon CSRC’s authorization, revise the prospectus or make a supplementary announcement accordingly.
Article 15. To apply for stocks listing, the applicant shall prepare a listing announcement in accordance with the rules of the respective stock exchange, which be published upon approval of the said stock exchange.
Directors, supervisors and senior management of the issuer shall sign confirmation opinion in writing for the listing announcement and ensure the truth, accuracy and completeness of the information disclosed. Meanwhile, such announcements shall bear the seal of the issuer.
Article 16. When the prospectuses or listing announcements quote professional opinions or reports of sponsors or securities service agencies, the content of such quotation shall be consistent with the content of the quoted document and ensure that it does not produce any misleading.
Article 17. The provisions of Articles 11 to 16 of these Measures in connection to the prospectuses are also applicable to the prospectuses of corporate bond issuances.
Article 18. After a listed company issues new stocks in a private offering, a report on the status of such issuance shall be disclosed in accordance with the law.
Chapter III Periodic Reports
Article 19. Periodic reports to be disclosed by listed companies include annual reports, mid-term reports and quarterly reports. Meanwhile, any information which will affect the investment decisions of the investors shall be disclosed.
The financial statements contained in annual reports shall have been audited by an accounting firm duly qualified to conduct securities and futures operations.
Article 20. Annual reports shall be completed and disclosed within 4 months from the end date of the corresponding fiscal year; mid-term reports shall be completed and disclosed within 2 months from the end date of the first half of the corresponding fiscal year; and quarterly reports shall be finished and disclosed within 1 month from the end date of the third and the ninth month of the corresponding fiscal year.
The first quarterly report of a fiscal year shall not be disclosed before the annual report of the previous year.
Article 21. Annual reports shall contain the following :
(1) The basic information of the company;
(2) The principal accounting data and financial indicators;
(3) Information of corporate stock and bonds issuance and movements; the aggregate value of stocks and bonds and the number of shareholders by the end of the reporting period; and the shareholding status of the 10 biggest shareholders;
(4) Information of the shareholders holding more than 5% of the corporate stock, the controlling shareholders and the de facto controllers;
(5) Information about the appointment of directors, supervisors and senior management, their shareholding movements and their annual remunerations;
(6) The report of the board of directors;
(7) Management discussions and analyses;
(8) The material events occurred in the reporting period and their effect on the company;
(9) Full copy of the financial statements and audit reports; and
(10) Any other items prescribed by the CSRC.
Article 22. Mid-term reports shall contain the following:
(1) The basic information of the company;
(2) The principal financial accounting standards;
(3) Information of stock and bonds issuance and movements; the number of shareholders; the shareholding status of the 10 biggest shareholders; and the changes of the controlling shareholders and the de facto controllers;
(4) Managements discussions and analyses;
(5) The material events such as a major lawsuits or arbitrations occurred in the reporting period, as well as their effect on the company;
(6) The financial statements; and
(7) Any other items prescribed by the CSRC.
Article 23. Quarterly reports shall contain the following:
(1) The basic information of the company;
(2) The principal financial accounting standards;
(3) Any other items prescribed by the CSRC.
Article 24. Periodic reports of a listed company shall bear the written confirmation opinion of its directors and senior management. The board of supervisors shall give written opinions on whether the drawing-up and review process conducted by the board of directors is consistent with the laws, the administrative regulations and the provisions set forth by the CSRC; as well as whether the content of such report reflects the actual situation of the listed company truthfully, accurately and entirely.
Directors, supervisors or senior management who are unable to guarantee or has objections against the truth, accuracy or completeness of any periodic report shall state their reasons and express their opinions, which shall be also disclosed.
Article 25. Where a listed company foresees losses or big changes in its operation results, it shall timely give advance notice of it.
Article 26. If before disclosing a periodic report, there is any information-leakage or rumor on the operation results and that the transactions of the securities and derivatives of the respective company experience abnormal movements, then the financial data related to such periodic report shall be timely disclosed by the listed company.
Article 27. In case the financial statements of a periodic report receive non-standard audit report, then the board of directors of the listed company shall make a special explanation on the issues mentioned in such audit report.
In case the financial statements of a periodic report receive a non-standard audit opinion and are suspected to be unlawful by the stock exchange, they shall be submitted to CSRC for investigation.
Article 28. In case a listed company fails to disclose any annual report or mid-term report within the prescribed time limit, the CSRC shall immediately initiate investigation and the stock exchange shall handle the case in accordance with stock market rules.
Article 29. The formats and rules for the preparation of annual, mid-term and quarterly reports will be formulated by the CSRC.
Chapter IV Temporary Reports
Article 30. If any material event that may considerably affect the trading price of the securities and derivatives of a listed company occurs and that it is not yet known by the investors, the listed company shall immediately give disclosure as well as explanation of the cause, the current situation and the possible consequences.
The term “material event” as mentioned in the preceding paragraph includes the following circumstances:
(1) Any major change in the managerial principle or in the business scope of the company;
(2) Any decision of the company on major investments or major purchases;
(3) Any important agreement concluded by the listed company that might significantly affect its corporate assets, liabilities, rights and interests or operation results;
(4) Any major debt incurred by the company or default on any major debt or any obligation to pay a large sum of compensation;
(5) Any major deficit or significant losses in the company;
(6) Material changes on the external conditions of the company’s production operation;
(7) Any change of directors, over one-third of the supervisors or managers of the company; or impossibility to perform duties of the chairman of the board of directors or the managers;
(8) Any considerable change on the control of the company or on the shareholding of the de facto controllers or any shareholders that holds more than 5% of the corporate stock;
(9) Any decision on capital reduction, merger, split-up, dissolution or application for bankruptcy; or falling in bankruptcy process or being ordered to close down in accordance with law;
(10) Cancellation or invalidation of any resolution of the shareholders’ assembly or the board of directors in relation to an important litigation or arbitration in which the company is involved.
(11) Investigation on any alleged offences conducted by the relevant authority or any criminal punishment or major administrative punishment imposed against the company; or any investigation or coercive measure conducted or imposed against the directors, supervisors or senior management of the company as a consequence of alleged violation of law or disciplinary rules;
(12) Any newly promulgated law, regulation, provisions or industrial policy that might significantly affect the company;
(13) Any resolution of board of directors on new stock offering plan or any other refinancing plan or any share rights incentive plan;
(14) Any court resolution prohibiting the controlling shareholders from transferring its shares; or any pledge, freezing of assets, judicially auction, custody, entrustment or voting rights legal limitation on the shares held by any shareholder that holds more than 5% of the corporate stock;
(15) Any seizure, retention, freezing, mortgage or pledge on the main assets of the company;
(16) Breaking down of the main or all the businesses;
(17) Granting of important external guaranty;
(18) Any extraneous income that might considerably affect the assets, liabilities, rights and interests or operation results of the company such as a large sum of government subsidy;
(19) Any changes on accounting policies or accounting estimates;
(20) Any order of the relevant authority or resolution of the board of directors issued or adopted in order to correct or amend errors, disclosure fail to comply with rules or false representations contained in the information previously disclosed;
(21) Any other circumstances as prescribed by the CSRC.
Article 31. A listed company shall perform timely its duty of disclosure on major events as soon as any of the following circumstances occurs:
(1) When a resolution of the board of directors or board of supervisors on the major event is adopted;
(2) When a letter of intent or agreement on the major events is executed by relevant parties; or
(3) When the directors, supervisors or senior managers learn and report the major event.
Where any of the following situations take place before the occurrence of the circumstances mentioned in the foregoing paragraph, the listed company shall timely disclose the current status and the risk factors that might affect the progress of the major event:
(a) When it is difficult to keep this major event confidential;
(b) When the information about the major event has been already divulged or relevant hearsay has appeared in the market; or
(c) When transactions on company’s securities or derivatives show abnormal movements.
Article 32. If after the disclosure of the major event, the evolution or change thereof might considerably affect the transaction prices of the securities and derivatives of the listed company, then such information as circumstances of evolution or change and the possible effect shall also be timely disclosed.
Article 33. Duty of disclosure of listed companies includes the major events as mentioned in Article 30 of these Measures occurred with respect to subsidiary companies controlled by the respective listed company that might considerably affect the transaction prices of the securities and derivatives of the said listed company.
Meanwhile, duty of disclosure of listed companies includes the events occurred with respect to subsidiary companies wherein the respective listed company has stock participation that might considerably affect the transaction prices of the securities and derivatives of the said listed company.
Article 34. Any act of acquisition, merger, split-up, issuance or re-purchase of shares conducted with respect to a listed company that results in a significant change on the total stock capital, shareholders or de facto controllers thereof, the company obliged to disclose information shall, in accordance with the law, fulfill its obligations of reporting and announcement, and disclose the status of legal rights changes.
Article 35. A listed company shall follow closely the abnormal movements on the transactions of its securities and derivatives as well as the media coverage thereof.
Where any abnormal movement on the transactions of the securities and derivatives of a listed company or the media coverage thereof might considerably affect the overall transactions of the said securities and derivatives, the listed company shall timely acknowledge such situation from all the relevant aspects and shall make inquiries in writing when it is necessary.
A listed company’s controlling shareholders and de facto controllers as well as the concerted shareholders of the latter shall timely and accurately inform the respective listed company about the existence of any important events such as a plan of share transfer or asset reorganization, and collaborate with the listed company to appropriately carry out the process of disclosure.
Article 36. Where any transaction on securities and derivatives is identified as abnormal by the CSRC or the stock exchange, the listed company shall promptly find out and disclose the causes of such abnormal movements.
Chapter V Disclosure Management
Article 37. Listed companies shall establish rules on the management of information disclosure, which shall contain the following:
(1) The information subjected to disclosure and its criteria;
(2) The procedure for the transmission and verification of undisclosed information and disclosure thereof;
(3) The duties of the administrative department for information disclosure and duty of the person-in-charge thereof in the process of disclosure;
(4) The duties of report, deliberation and disclosure of the directors, the board of directors, the supervisors and the board of supervisors, as well as senior managers, etc.;
(5) The system of recording and safekeeping the records on the performance of duties of disclosure of the directors, supervisors and senior managers;
(6) The confidentiality measures for undisclosed information; and the range of insiders and their duties of confidentiality;
(7) The internal control and supervisory system of the financial management and accounting;
(8) The procedure of applications, verification and issuance of public announcements; and the system of communication with investors, securities service agencies, mass medias, etc.;
(9) The management of archives of the relevant disclosure documents and materials;
(10) The management and reporting system for the disclosure of information related to subsidiaries companies; and
(11) The rules on the determination of the liabilities of non-performance of disclosure duties; and the coercive measures to be adopted against violators.
The rules on the management of disclosure information shall be established by resolution of the board of directors, and shall be submitted to the local securities regulatory bureau of the corresponding registration place and the relevant stock exchange for archive.
Article 38. The directors, supervisors and senior managers of listed companies shall be diligent and duteous, and shall follow closely the process of disclosures in order to ensure the timely disclosure of periodic reports and temporary reports, and cooperate with the listed company and other disclosers in the performance of their duties of disclosure.
Article 39. Listed companies shall establish procedures for the preparation, deliberation and disclosure of periodic reports. Senior officers such as the general manager, the finance manager and the secretary of the board of directors shall timely draw-up the periodic report drafts and submit them to the board of directors for deliberation. The secretary of the board of directors is responsible for servicing the said drafts to the directors for examination. The chairman of the board of directors is responsible for convening and presiding over the meetings of board of directors for deliberating such reports. The board of supervisors is responsible for verifying them. And the secretary of the board of directors is responsible for organizing the process of disclosure.
Article 40. Listed companies shall establish procedures for reporting, transmitting, examining, verifying and disclosing major events. When the directors, supervisors and senior managers learn about a major event, they shall immediately perform their duty of reporting in accordance with said procedure. The chairman of the board of directors that received a report shall immediately inform it to the board of directors and urge the secretary of the board of directors to organize the process of disclosure of temporary reports.
Article 41. Listed companies shall not provide any insider information referred to business operations, financial status and other issues in business-results-seminars, analyst seminars, road shows, investors’ researches or similar events held with the purpose of conducting communications with institutions and individuals.
Article 42. The directors shall follow closely and continuously the company’s production management status, financial status and the major events that have already occurred or likely to occur as well as the influences thereof; and shall actively investigate and obtain the information required for the decision-making.
Article 43. The supervisors shall oversee the fulfillment of the duties of disclosure of the directors and senior managers of the company; and follow closely the status of disclosure. Whoever learns any illegal issues in the disclosures shall initiate the corresponding investigation and propose the solution.
The written opinions of the board of supervisors on periodic reports shall express whether the process of preparation and verification conforms to the law, administrative regulations and CSRC provisions, and whether the contents of the report truthfully, accurately and entirely reflect the actual situation of the company.
Article 44. Senior managers shall timely report to the board of directors the major events occurred with respect to the business operations or financial status of the company, as well as the evolution and changes of the disclosed events and other related information.
Article 45. The secretary of the board of directors is in charge of the organizeing and coordination of the disclosure; the compilation of the information to be disclosed and the reporting of them to the board of directors; and shall follow closely and continuously the relevant media coverage and take the initiative to verify the reality of the news reports. The secretary of the board of directors has the right to attend shareholders’ meetings, board of directors’ meetings, board of supervisors’ meetings and relevant meetings of the senior managers, to learn the business and financial status of the company and to consult all the documents related to the disclosures.
The secretary of the board of directors is in charge of all the matters concerned to public announcements of the listed company. Expect the announcements of the board of supervisors; all the disclosures shall be released in the form of announcements of the board of directors. Without written authorization of the board of directors, no director, supervisor or senior manager may publicly announce any undisclosed information of the listed company.
Listed companies shall provide convenient conditions for the secretary of the board of directors to perform his duties. The financial managers shall collaborate with the secretary of the board of directors in the works related to the disclosure of financial information.
Article 46. When any of the following events occur, the shareholders or actual controllers of listed companies shall, on their own initiative, report it to the board of directors and assist the company to fulfill its duty of disclosure:
(1) Any considerable change on the control of the company or on the shareholding of the actual controllers or any shareholders that holds more than 5% of the corporate stock;
(2) Court order that prohibits the controlling shareholders from transferring their shares; or pledges, freezing, judicially auctions, custodies, entrustments or voting rights limitations on the shares held by a shareholder that individually holds more than 5% of the corporate stock;
(3) Planning on significant assets or business restructuring with respect to the listed company; or
(4) Other circumstances prescribed by the CSRC.
Where prior to the disclosure, the relevant information has been divulged in mass media or where the transactions on the securities and derivatives of the company have experienced abnormal movements, the shareholders or actual controllers of such company shall timely and accurately file a written report with the respective said company and assist it for a timely and accurate announcement.
Shareholders or de facto controllers of listed companies shall not abuse their rights or predominant position; and shall not request insider information from the listed company.
Article 47. When a listed company makes a private stock offering, its controlling shareholders, actual controllers and the offerees shall promptly provide the relevant information to the listed company and assist it to perform the duty of disclosure.
Article 48. The directors, supervisors, senior managers, shareholders that individually hold more than 5% of the corporate stock, the concerted shareholders and the actual controllers shall timely file with the board of directors a name list of the affiliated parties of the respective listed companies and a statement of the affiliation. The listed company shall comply with the procedures established for the deliberation of affiliated transactions and shall strictly fulfill the rules on the exclusion of the involved shareholders in voting the respective affiliated transactions. None of the parties to such transactions may circumvent the process of deliberation of affiliated transactions and the process of disclosure of the listed company by concealment of such affiliation relationship or adoption of any other means.
Article 49. The actual controllers or shareholders that individually hold more than 5% of the corporate stock of a listed company by means of entrustments or trusts shall timely inform the listed company about the entrusting party and assist the said listed company to perform the duty of disclosure.
Article 50. Disclosers shall provide all the materials related to the area of practice for the hired sponsor and securities service agencies; shall ensure the authenticity, accuracy and integrity of such materials; and shall not refuse to provide such materials, conceal them or provide false statements.
If in the process of the preparation of specialized documents for the disclosure, the sponsor or securities service agencies found false records, misleading statements or serious omissions in the materials provided by the listed company or by any other discloser, or any other major illegal acts, they shall require a supplementation or correction. If the discloser fails to do so, the sponsor or securities service agencies shall timely report it to the relevant stock exchange and the securities regulatory bureau of the place where the discloser is registered.
Article 51. Once the board of directors adopts the decision of dismissing the accounting firm, the listed company shall timely notified it to the said accounting firm, which shall be allowed to present its opinions in the general shareholders’ meeting that votes on such dismissal. In case the general shareholders’ meeting resolves on dismissing and changing the accounting firm, the specific reasons for such decision as well as the opinions of the accounting firm shall be included in the corresponding disclosure.
Article 52. Sponsors or securities services agencies that issue specialized documents for the performance of discloser’s duties of disclosure shall be diligent, duteous, honest and faithful in expressing its professional opinions in accordance with the business rules, industrial norms and moral criteria established in line with the law; and shall ensure the truth, accuracy and integrity of the documents they issue.
Article 53. Certified public accountants shall act in accordance with the principles of risk-based audit, follow strictly the professional rules and relevant provisions established for certified public accountants, improve the authentication procedures, select the authentication methods and technologies scientifically, be completely acquaintance with the audited entity and its environment, follow closely and prudently the risk of serious wrong reports, and obtain adequate and appropriate proofs required for issuing reasonable auditing conclusions.
Article 54. Asset assessment companies shall scrupulously abide by professional ethics; strictly follow the assessment rules or norms; choose a proper assessment approach; and ensure the hypotheses set forth in the process of assessment is in line with the actual situation. In order to give reasonable assessment conclusions, they shall also collect adequate proofs to support the legality and the forecast-reliability of the transactions, revenues, expenses and investments of the assessed company, and be fully aware of the probability of any variable and its consequences thereof.
Article 55. No institution or individual may illegally obtain, provide or transmit any insider information of listed companies, or buy, sell or recommend others to buy or sell securities and derivatives by using insider information, or use insider information for investment value analysis, research reports or other documents.
Article 56. Mass media shall objectively and truthfully report the status of listed companies and exert the supervisory functions of public opinion.
No organizations or individuals may provide or transmit any false or misleading information of listed companies.
Violators of the rules contained in the foregoing two paragraphs shall be liable for the losses caused to investors.
Chapter VI Supervision, Administration and Liabilities
Article 57. The CSRC may require listed companies and other disclosers, or the directors, supervisors and senior managers thereof to explain, demonstrate or provide relevant materials related to the issues of the disclosure; as well as require the listed company to provide the professional opinions formulated by the sponsor or securities service agency.
If the CSRC has any doubt about the authenticity, accuracy and integrity of any document issued by the sponsor or securities service agency, it may require further explanation or supplementation, and consult their working papers.
Listed companies, sponsors, securities service agencies and other disclosers shall reply promptly and collaborate with the inspections and investigations of the CSRC.
Article 58. The directors, supervisors and senior managers of listed companies are liable for the authenticity, accuracy, integrity, timeliness and fairness of the disclosed information; unless there are adequate evidences to prove that they have performed their duties diligently and duteously.
The directors, managers and the secretary of the board of directors of listed companies shall bear the main responsibility in the authenticity, accuracy, integrity, timeliness and fairness of the information disclosed in temporary reports of the company.
The chairman, the general manager and the finance manager of a listed company shall bear the main responsibility in the authenticity, accuracy, integrity, timeliness and fairness of the financial reports of the company.
Article 59. Where discloser as well as their directors, supervisors and senior managers thereof, and the listed companies’ shareholders, actual controllers or purchasers as well as their directors, supervisors and senior managers thereof violates these Measures, the CSRC may adopt the following supervisory measures:
(1) Correction orders;
(2) Supervisory talks;
(3) Issuance of letters of warning;
(4) Recording such situations as the violation, the non-performance of public commitment etc, into the corresponding credit file and publishing it;
(5) Recording the violator as an inappropriate candidate; and
(6) Adopting other supervisory measures in accordance with law.
Article 60. Listed companies that failed to set forth the rules on disclosure management in accordance with these Measures shall receive a correction order from the CSRC; and if the fault persists, it shall be warned and fined by the CSRC.
Article 61. Disclosers failed to perform the duty of disclosure within the prescribed term or committed false record, misleading statement or serious omission in the disclosed information shall be punished in accordance with Article 193 of the Securities Law.
Article 62. Disclosers that failed to submit the relevant reports within the prescribed term or committed false record, misleading statement or serious omission in any report submitted to the CSRC shall be punished in accordance with Article 193 of the Securities Law.
Article 63. Listed companies that circumvent the disclosure or the reports by concealment of affiliation relationship or adoption of any other means shall be punished in accordance with Article 193 of the Securities Law.
Article 64. Shareholders or actual controllers of a listed company that failed to collaborate with the listed company to perform the duties of disclosure or unlawfully required insider information from the listed company shall be ordered to correct or be warned or fined by the CSRC.
Article 65. Sponsors or securities service agencies or any of their personnel that, on the occasion of issuing specialized documents for disclosure, violate the Securities Law, any administrative regulations or any CSRC provisions will be subjected to the corresponding supervisory measures to be adopted by the CSRC such as correction orders, supervisory talks, letters of warning and recording of the violation in the respective credit files. If it is necessary, the CSRC shall impose administrative punishments in accordance with the law.
Article 66. Any institution or individual who divulges insider information of a listed company or conducts securities and derivatives trading by using insider information shall be punished by the CSRC in accordance with Articles 201 and 202 of the Securities Law.
Article 67. Any institution or individual who fabricates or spreads false information that disturbs the securities market and any mass media that disseminates untrue or not objective information shall be punished by the CSRC in accordance with Article 206 of the Securities Law.
Anyone who makes false statements or gives misleading information in securities and derivatives trading shall be punished by the CSRC in accordance with Article 207 of the Securities Law.
Article 68. In case of the existence of any alleged extortion to listed companies by threatening them with news reports or other means of dissemination, the CSRC shall issue a correction order and send out its suggestions to the relevant authorities which shall investigate for legal responsibility.
Article 69. Listed companies or other disclosers that commit gross violation of the present Measures may be banned by the CSRC from the securities market.
Article 70. If the act of violation of the present Measures constitutes a crime, the violator shall be transferred to the judicial organ for criminal investigation.
Chapter VII Supplementary Provisions
Article 71. The following terms mentioned in these Measures are defined as follows:
(1) The term “sponsors or securities services agencies that issue specialized documents for the performance of discloser’s duties of disclosure” refers to the sponsors, accounting firms, asset assessment companies, law firms, financial consultant companies and credit rating companies that issue recommendation documents, audit reports, asset assessment reports, legal advices, financial consultant’s reports, credit rating reports, etc. for the securities offering, listing and trading;
(2) The term “timely” means within 2 trading days from the starting date or the occurrence of the circumstances where information disclosures are required.
(3) The term “affiliated transactions of a listed company” refers to any act that results in the transfer of resources or obligations between the listed company or its controlled subsidiaries and the affiliates of the said listed company. The term “affiliates” includes affiliated legal and affiliated natural persons. The following legal persons are considered affiliate of a listed company:
(a) Any legal person who directly or indirectly controls the listed company;
(b) Any legal person, other than the listed company and its controlled subsidiaries, that is directly or indirectly controlled by the legal person mentioned in the foregoing item (a);
(c) Any legal person, other than the listed company and its controlled subsidiaries, that is directly or indirectly controlled by an affiliated natural person or in which the affiliated natural person assumes the position of director or senior manager;
(d) Any legal person that holds more than 5% of the corporate stock of the listed company and the concerted parties thereof;
(e) Any legal person that has fallen into any of the abovementioned circumstances in past 12 months or that, according to the relevant agreements and arrangements, will fall into them in the upcoming 12 months; and
(f) Any other legal person that according to the substance over form principle is identified by the CSRC or stock exchange or the listed company itself as an entity that has such a special relationship with said listed company and thereby might be or has been inclined to the interests thereof.
The following natural persons are considered as affiliated natural persons of a listed company:
(a) Any natural persons who directly or indirectly holds more than 5% of the corporate stock of the listed company;
(b) The directors, supervisors and senior managers of the listed company;
(c) The directors, supervisors and senior managers of the legal person who directly or indirectly controls the listed company;
(d) The intimately related family members of the persons mentioned in foregoing items (a) and (b), including the spouses, parents, children over 18 years old and the spouses thereof, siblings and the spouses thereof, parents-in-law and siblings-in-law, as well as the parents of the children’s spouses.
(e) Any person that has fallen into any of the abovementioned circumstances in past 12 months or that, according to the relevant agreements and arrangements, will fall into them in the upcoming 12 months; and
(f) Any other natural person that according to the principle of substance-over-form is identified by the CSRC or stock exchange or the listed company itself as an individual that has such a special relationship with said listed company and thereby might be or has been inclined to the interests thereof.
(4) The term “designated media” refers to the newspapers, periodicals and websites designated by the CSRC.
Article 72. These Measures shall come into force as of the date of promulgation. "Detailed Rules for Listed Company Disclosures (for Trial Implementation)" (No. 43 [1993], CSRC), "Circular on Issues Related to Public Stock Offering and Listed Company Disclosures" (No. 19 [1993], CSRC), "Circular on Strengthening the Examination of Listed Company’s Temporary Reports" (No. 26 [1996], CSRC), "Circular on Several Issues Concerning the Release of Listed Company Announcements of Clarification" (No. 28 [1996], CSRC), "Circular on Electronic Archive of Listed Company Disclosures" (No. 50 [1998], CSRC), "Circular on Further Strengthening the Supervision over the Disclosure of ST and PT Companies" (No. 63 [2000], CSRC), "Circular on Issues Concerning the Mid-term Reports of Listed Companies that Plan to Issue New Stocks" (No. 69 [2001], CSRC) and "Circular on the Archive of Listed Company’s Temporary Reports and Pertinent Annexes Submitted to the China Securities Regulatory Commission’s Dispatched Agencies" (No. 7 [2003], CSRC) shall be simultaneously annulled.
(This English version by China Securities Investor Protection Fund Co., Ltd. is for your reference only. In case any discrepancy exists between the Chinese and English context, the Chinese version shall prevail.)
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