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| 2002092820021201China Securities Regulatory CommissionOrder of China Securities Regulatory CommissionNo.11The Measures for the Administration of Disclosure of Shareholder Equity Changes of Listed Companies are hereby promulgated and shall enter into force on December 1, 2002.President of China Securities Regulatory Commission Zhou XiaochuanSeptember 28, 2002epdf/e03124.pdfIlisted company, shareholder, equity changes, disclosuree03124Measures for the Administration of Disclosure of Shareholder Equity Changes of Listed CompaniesChapter I General RulesArticle 1 In order to regulate the disclosure of shareholder equity changes of listed companies, to supervise those obliged to disclose the shareholder equity changes of listed companies to perform their obligations pursuant to the provisions, to protect the legal rights and interests of the investors and to maintain the normal order of the securities market, these Measures are formulated in accordance with the Company Law, the Securities Law and other laws and relevant administrative regulations.Article 2 The shareholder equity changes of listed companies (hereinafter referred to as equity changes) as mentioned in the present Measures shall refer to the situation where the number of shares held by an investor is changed or may be changed through share assignment in stock exchanges; or the situation where though the number of shares of a listed company held by an investor remains unchanged, the number of shares controlled by that investor is changed or may be changed through other legal means than share assignment in stock exchanges.Article 3 Those obliged to disclose equity changes shall, pursuant to the present Measures, strictly perform their obligations of information disclosure, and the information disclosed by them shall be authentic, accurate, complete, and without false records, misleading statements or major omissions.The disclosure obligors and other insiders may not, before the relevant equity changes are disclosed according to the law, disclose relevant information by any means.Article 4 Nobody shall take advantage of equity changes to damage the legal rights and interests of a listed company and its shareholders.Nobody may take advantage of equity changes to conduct inside trading, market manipulation and other frauds.Article 5 China Securities Regulatory Commission (hereinafter referred to as CSRC) shall supervise and regulate the disclosure of equity changes according to the law.Stock exchanges and securities registration and settlement institutions shall, in accordance with the duties endowed by CSRS and their professional rules, exercise daily supervision and regulation over the disclosure of equity changes.Chapter II Obligors of Equity Change DisclosureArticle 6 The obligors of equity change disclosure (hereinafter referred to as disclosure obligors) shall refer to the shareholder, share controller and group as a person that is, pursuant to the present Measures, obliged to disclose the information when the number of shares of a listed company held or controlled by it is changed or may be changed and the change has reached the prescribed ratio.Article 7 A shareholder shall refer to a natural person, legal person or other organization that is registered in the shareholder register of a listed company.Article 8 A share controller shall refer to a natural person, legal person or other organization that, without registering the shares under its name, controls the shares of a listed company held by others by legal means, such as equity control relationship, agreement, or other arrangement etc, other than share assignment in the stock exchanges.Article 9 A group as a person shall refer to 2 or more natural persons, legal persons or other organizations that make the same declaration of will when exercising their voting power of the listed company to expand the ratio of shares of that listed company controlled by them or to strengthen their control over the listed company by legal means such as agreement, cooperation, association relationship, etc.Making the same declaration of will as mentioned in the preceding paragraph shall include joint proposal, joint nomination of directors, entrustment to each other of the exercise of voting power without vote intent indicated etc; however, the open invitation of vote agency shall be excluded.Article 10 A group as a person shall, from the date on which the group relation is formed, apply for temporary keeping of all the stocks of that company respectively held or controlled by them with the securities registration and settlement institution, the duration of the temporary keeping shall be not less than 6 months.Article 11 A disclosure obligor shall combine in calculation of the shares of a listed company held or controlled by it.A disclosure obligor that holds or controls the convertible bonds issued by a listed company shall, during the conversion, combine in calculation of the part that it has the right to convert with the shares of the same listed company held or controlled by it.Chapter III Report and Public Announcement on Equity ChangesArticle 12 A disclosure obligor shall, in performance of the disclosure obligation pursuant to the present Measures, submit the report on equity changes of the listed company to the stock exchange (hereinafter referred to as the report on equity changes).The obligor mentioned in the preceding paragraph shall, when submitting the report on equity changes, send the report also to CSRC and send a copy to the branch of CSRC of the place where the listed company is located, notify the listed company and make a public announcement.The contents and format of the report on equity changes shall be separately worked out by CSRC.Article 13 Where the are several disclosure obligors, one of them may be responsible for the unified formulation of the report on equity changes as agreed upon in written by the obligors, but each obligor shall sign and seal in the report.Each disclosure obligor shall be liable for the information involving it in the report on equity changes; with respect to the information related to several disclosure obligors involved in the report, each obligor shall bear joint and several liabilities for the relevant part.Article 14 A report on equity changes shall include the following matters:1)Names and domiciles of the disclosure obligors;2)Name of the listed company;3)Changes of the shares held or controlled by the disclosure obligors;4)Types of equity changes;5)Trading of shares of that listed company conducted by the disclosure obligors in the previous 6 months;6)Other matters need to be indicated as required by CSRC and the stock exchange.Article 15 If an investor starts to hold or control more than 5% of the shares issued by a listed company, it shall, pursuant to the present Measures, perform the disclosure obligation and submit the report on equity changes within 3 work days after the date when the changes take place.That investor may not trade the shares of that listed company any more within the aforesaid period.Article 16 If an investor foresees to hold or control 5% of the shares issued by a listed company, it shall perform the disclosure obligation and submit the report pursuant to the present Measures.If no public announcement is made, that investor may no longer trade the shares of that listed company.Article 17 A disclosure obligor that holds or controls more than 5% of the shares issued by a listed company shall, each time when the equity is changed by more than 5%, submit the report on equity changes within 3 work days after the date when the changes take place.From the date of occurrence of report obligation to the second work day following the public announcement, the disclosure obligor may not trade the stocks of that listed company any more.Article 18 A disclosure obligor that holds or controls more than 5% of the shares issued by a listed company shall submit the report on equity changes if he foresees an equity change of more than 5% of the shares issued by that listed company.From the date of occurrence of report obligation to the second work day following the public announcement, the disclosure obligor may not trade the stocks of that listed company any more.Article 19 If the equity change of a disclosure obligor does not exceed 5%, but the shares held or controlled by the obligor become less than 5% of the shares issued by that company, the obligor shall make a public announcement within 3 work days after the date of occurrence of that fact, but is not required to submit the report on equity changes.Article 20 If the equity change results in the acquirement or possible acquirement of the actual control power of the listed company by a purchaser, the purchaser shall, pursuant to the Measures for the Administration of Acquisition of Listed Companies, submit the report on acquisition of the listed company to CSRC, and to the branch of CSRC of the place where the listed company is located, and send a copy of the report to the stock exchange, notify that listed company and make a public announcement.Article 21 If the share assignment through agreement results in any of the situations of equity change prescribed in Articles 16 and 18 of the present Measures, the disclosure obligor shall, within 3 work days after the date of signing of the agreement on share assignment, perform the relevant obligations pursuant to Articles 16 and 18 of the present Measures.Article 22 If the administrative allocation results in any of the situations of equity change prescribed in Articles 16 and 18 of the present Measures, the disclosure obligor shall, within 3 work days after the date of receiving the notification of approval for the allocation by the department directly in charge of the state-owned equity, perform the relevant obligations pursuant to Articles 16 and 18 of the present Measures.Article 23 If the ruling of a people's court results in any of the situations of equity change prescribed in Articles 16 and 18 of the present Measures, the applicant for enforcement shall, within 3 work days after the date of confirmation of its application for share assignment by the stock exchange, perform the relevant obligations pursuant to Articles 16 and18 of the present Measures.Article 24 If the change of share controllers by other legal means than share assignment in the stock exchange results in any of the situations of equity change prescribed in Articles 16 and 18 of the present Measures, the disclosure obligor shall, within 3 work days after the date of occurrence of the equity change, perform the relevant obligations pursuant to Articles 16 and18 of the present Measures.Article 25 If a disclosure obligor needs to submit the report on equity changes for a second time because of a new equity change, it may make the report or public announcement only on the part that is different from that of the previous report.Article 26 If the reduction of equity capital by a listed company results in any of situations of equity change of the disclosure obligor prescribed in Articles 15, 16, 17 and18 of the present Measures, the disclosure obligor is not requested to submit the report on equity changes.In case of a reduction of the equity capital, a listed company shall, within 2 work days after the date when the changes are registered, make a public announcement on the equity changes resulted therefrom.Article 27 If the shareholder is an institution undertaking securities registration or trusteeship pursuant to the law and it holds the shares as a result of the aforesaid operations, it is not required to submit the report on equity changes.Article 28 For the assignment of shares held by an institution authorized by the State, or the assignment of shares that is subject to administrative examination and approval, the parties concerned shall make a public announcement on the relevant decisions within 3 work days after the date of receiving the approval for the assignment by the relevant department in charge.Article 29 A disclosure obligor shall, within 2 work days after the date of registration of transfer of ownership over the shares, make a public announcement on the transfer of ownership.If a disclosure obligor fails to finish the formalities for transfer of ownership of shares within 30 days after the public announcement of equity changes, it shall make another public announcement immediately and explain the reasons; a public announcement shall be made every 30 days before the transfer of ownership is finished.Article 30 If a disclosure obligor that has made a public announcement on the report of equity changes is involved in any of the following situations, it shall make a public announcement on that situation within 2 work days after the date of occurrence, but it is not required to stop trading the stocks of that listed company or to submit a new report on equity changes:1)In concentrated competitive trading in the stock exchange, each time the shares of the listed company held by the obligor is increased or reduced by 1%;2)Any member of the group as a person is changed;3)Other situations provided for by CSRC and the stock exchange.Article 31 A listed company shall verify the equity changes with the securities registration and settlement institution regularly, and shall report to the stock exchange in time.Article 32 If any relevant information is spread in the media or trading of the shares of the company becomes abnormal before the relevant information about the equity changes is disclosed pursuant to the law, the board of directors of the listed company shall check with the relevant shareholders immediately, which shall reply in written form in a timely manner, and the company shall make a public announcement in a timely manner.Article 33 A disclosure obligor shall disclose the information related to equity changes on at least one media designate by CSRC; the contents of disclosure in other media shall be consistent with those on the designated media, and the time of disclosure shall be not earlier than that on the designated media.Chapter IV Regulatory Measures and Legal LiabilitiesArticle 34 If a disclosure obligor fails to perform the relevant obligations pursuant to the present Measures, it shall make voluntary corrections; for its failure to correct, the stock exchange shall deal with it pursuant to its professional rules, and the securities registration and settlement institution shall suspend processing the formalities for transfer of share ownership for it pursuant to its professional rules; if the obligor refuses to correct, CSRC shall order it to correct. In case of any violation of the securities laws and regulations, the legal liabilities shall be investigated pursuant to the law.Article 35 If the information disclosed by the disclosure obligor contains false records, misleading statements or major omissions, it shall make voluntary corrections; for its failure to correct, the stock exchange shall deal with it pursuant to its professional rules, and the securities registration and settlement institution shall suspend processing the formalities for transfer of share ownership for it pursuant to its professional rules; if the obligor refuses to correct, CSRC shall order it to correct. In case of any violation of the securities laws and regulations, the legal liabilities shall be investigated pursuant to the law.Article 36 If a disclosure obligor fails to disclose information pursuant to the provisions, and is suspected of inside trading, market manipulation or other frauds, CSRC shall investigate the case and punish the offender pursuant to the law.During the investigation of the disclosure obligor for the acts prescribed in the preceding paragraph, the disclosure obligor may not nominate any director, supervisor or senior officer to the relevant listed company.Chapter V MiscellaneousArticle 37 The "association relationship" referred to in the present Measures has the same meaning as that of the "association relationship" used in the Accounting Rules for Business Enterprises -- Disclosure of Association Relationship and of Trading between Associated Parties.Article 38 The present Measures shall enter into force on December 1, 2002. |
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