China Securities Regulatory Commission Notice [2008] No.10 - Provisions for the Administration of Chief Risk Officers of Futures Companies (Trial Implementation)
中国证券监督管理委员会公告[2008]10号 - 期货公司首席风险官管理规定(试行)
May 08, 2008 | BY
clpstaff &clp articles &CSRC requires a chief risk officer in futures companies.
Promulgated: March 27 2008
Effective: May 1 2008
Applicability: Chief risk officers are senior management personnel of futures companies who are responsible for carrying out supervision and inspection of the company's legal compliance of its operation and management, and the company's risk management status (Article 2).
Main Contents: A chief risk officer is accountable to the board of directors of a futures company (Article 2). A chief risk officer shall conduct an inquiry and investigation in respect of the potential violations that may arise and latent risks that may exist in the course of the operation and management of the futures company, and focus on inspecting whether the futures company has established and effectively implemented sound systems such as systems for safe custody of customers' margins, administration of risk monitoring indicators, and corporate governance and internal controls (Article 20).
Where a chief risk officer discovers that the futures company has committed any of the following violations of laws or regulations or there is a major latent risk, it shall report to the agency of the China Securities Regulatory Commission (CSRC) at the place of domicile of the company, and to the company's board of directors and supervisory board:
(1) the futures company is suspected of infringing upon customers' rights and interests by encroaching upon or misappropriating customers' margins;
(2) the assets of the futures company have been withdrawn, encroached, misappropriated, sealed up, frozen or used as a security;
(3) the net capital of the futures company fails to meet the regulatory standards on a continual basis;
(4) the futures company is involved in a major litigation or arbitration that may lead to major risks; or
(5) the shareholders interfere with the normal operation of the futures company.
In such circumstances, the futures company shall carry out rectification according to the rectification opinions of the CSRC agency at the place of domicile of the company. The chief risk officer shall assist the rectification and report the details of the rectification to the CSRC agency at the place of domicile of the company (Article 24).
Related Legislation: Regulations for the Administration of Futures Trading (Revised); Measures for the Administration of Futures Companies, Apr 9 2007, CLP 2007 No.8 p.47; and Measures on the Administration of the Qualifications of the Directors, Supervisors and Senior Management Personnel of Futures Companies, Jul 4 2007, CLP 2007 No.7 p.11
clp reference:3600/08.03.27promulgated:2008-03-27effective:2008-05-01This premium content is reserved for
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