Friday May 27 2016

News Source: Global Exchanges

Focus: Listing Rules

Type: General




Shenzhen Stock Exchange has recently released a Memorandum on Trading Suspensions and Resumptions for Listed Companies which was formulated on the basis of regulatory practices and in response to recent emerging market situations. The Memorandum aims to further regulate trading suspensions and resumptions of shares of listed companies, maintain market efficiency and safeguard the right to trade, the right to know and other legitimate rights and interests of investors.

The Memorandum requires that listed companies keep information confidential and conduct phased information disclosure in order to maintain trading continuity. Listed companies in question are also required to make prudent judgment on the duration of proposed trading suspensions. Given the situation in practice where a listed company may have difficulties in conducting phased information disclosure in a timely manner, thus necessitating an application for trading suspension, the Memorandum requires that the company take effective measures to prevent extended suspension and abuses that infringe on investors` rights to trade and to know. If listed companies abuse trading suspension or unreasonably extend suspension duration in violation of the Memorandum, the Exchange shall notify the market of the relevant situation through public announcements or other means and resume trading of the shares of the companies in question.

The Memorandum further clarifies the following aspects:  

  • the maximum duration of suspension pending on major events,
  • enhancing investors’ supervision on long-term suspensions,
  • refining requirements for information disclosure on suspension and resumption, and
  • strengthening restraints on suspension and enhancing the role of intermediaries.

Click on the link above for further details.