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CSRC issues guidelines on A-share trading suspension, resumption

Xinhua Financein CFBOND
2018-11-08 09:10

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The China Securities Regulatory Commission (CSRC) issued its guidelines on the suspension and resumption of share trading at China's stock market on Tuesday.

These guidelines address issues such as prolonged trading halts and too many triggers for such actions at China's stock market.

In its guidelines, CSRC, China's securities watchdog, sets the core principles aimed at ensuring sufficient trading opportunities at the A-share market, requiring that trading suspension should be avoided as much as possible, last for a short period if such an action has to be taken, and occur only on a discontinuous basis. 

Neither uncertainties surrounding corporate issues nor confidentiality obligations should qualify as causes for suspending stock trading. In case of a major event, a public company should disclose the related information on a timely basis.

The guidelines cut the duration of trading suspension to enhance market liquidity. 

Trading halts due to major reorganization should be shortened and in principle, shares of a company undergoing bankruptcy reorganization should sustain their trading. If a company fails to restart the trading of its stocks beyond a period of suspension, the stock exchange should force a resumption.

Trading of a company's shares should be halted on the day when a meeting is held to review its plan for merger, acquisition or restructuring.

The guidelines demand more stringent information disclosure requirements to enable clearer market expectations.

The guidelines urge China's stock exchanges to put in place corresponding arrangements in this regard, including detailed rules on suspending and resuming share trading and mechanisms for information disclosure.

These CSRC's latest guidelines represent the first of China's policies to improve trading supervision, reduce trading obstacles and spur more vitality at the country's stock market, said a report of Shanghai Securities News on Wednesday.
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