China News Service, Beijing, December 12 (Reporter Chen Kangliang) The person in charge of the relevant department of the China Securities Regulatory Commission said on the 27th that it will establish and improve the working mechanism of penetrating supervision, and severely crack down on behaviors that violate the requirements of "restricted shares shall not be allowed to be borrowed" through multi-layer nesting, collusive trading, tandem arbitrage, etc.
On October 10, the Shanghai Stock Exchange, the Shenzhen Stock Exchange and the Beijing Stock Exchange issued the Notice on Optimizing the Relevant Arrangements for Securities Lending and Lending Transactions and Refinancing Securities Lending Transactions, which clarified that "if an investor holds restricted shares or strategic placement shares of a listed company, as well as shares subject to transfer restrictions such as the reduction of shares by major shareholders or specific shareholders transferred by way of block trading, investors and their affiliates shall not sell the shares of the listed company through securities lending during the restriction period", which further improves the "restricted shares shall not be allowed to be borrowed and borrowed" requirements. At the same time, securities companies are required to verify the situation of investors in accordance with the principle of penetration, conduct front-end control over investors' relevant trading behaviors, and strictly prohibit participation in violations or facilitation of violations.
Recently, some media reported that brokerages have implemented the new regulations of "restricted shares are not allowed to lend securities", and the constraints imposed by various brokerages on customers are different. In this regard, the above-mentioned person in charge said that after the issuance of the new regulations, the regulatory authorities and industry associations urged securities companies to implement the requirements of the new regulations by issuing notices, on-site inspections, industry training and other means. Securities companies will inform investors of the new requirements by issuing announcements, modifying contracts, signing letters of commitment, etc., and pay close attention to improving the system, strengthening business control, and arranging special personnel to do a good job in transaction declaration and front-end control before the completion of system transformation. On the whole, most securities companies are basically in place in implementing the requirements of the new regulations, but on-site inspections have also found that some securities companies have problems such as insufficient verification of related parties.
The person in charge said that in the next step, the China Securities Regulatory Commission will be in accordance with the requirements of the Central Financial Work Conference, comprehensively strengthen penetrating supervision, on the one hand, consolidate the responsibilities of securities companies, and urge securities companies to strengthen the penetrating management of customer trading behavior and trading purposes in accordance with the requirements of "not seeing clearly, not doing business", strictly prohibiting participation in violations or providing convenience for violations, and effectively improving the business level. On the other hand, strengthen supervision and law enforcement, establish and improve the working mechanism of penetrating supervision, and strictly crack down on violations of the requirements of "restricted shares shall not be allowed to lend securities" through multi-layer nesting, collusive trading, tandem arbitrage, etc., and investigate and deal with them together, and welcome all market participants to jointly supervise the implementation of the regulations. (ENDS)