CHINA: Shanghai Stock Exchange consultation on disclosure requirements for China securities margin trading and securities refinancing

Friday May 3 2013

The Shanghai Stock Exchange (SSE) has announced changes to China margin trading and securities refinancing rules. The SSE has issued a set of draft measures that will require shareholders in the margin trading and securities finance business to disclose the consolidated number of shares of any single listed company held in multiple securities accounts, excluding those in accounts backed by customer credit transactions or refinancing. The move is designed to raise the transparency of shareholders’ holdings.

In addition, the draft measures will require that:

• Investors who hold over 30 percent of a company should, in line with the Measures for the Administration of the Takeover of Listed Companies, register their plan to take over the company or apply for an exemption with the CSRC;
• Shareholders who hold over 5 percent of a listed company and who become lenders for refinancing cannot take part in short-term transactions; and
• Company managers who hold over 5 percent of their company’s stock cannot target that stock for margin trading and short selling.

The consultation is open for comment until 15th May 2013.

Click on the above link for the draft (Chinese).