SECURITIES REGULATOR AMENDS RULES TO HELP BOLSTER INVESTOR CONFIDENCE
October 15, 2008 | BY
clpstaff &clp articlesChina Securities Regulatory Commission (CSRC) has issued amendments to theMeasures for the Administration of the Takeover of Listed Companies 《上市公司收购管理办法》,…
China Securities Regulatory Commission (CSRC) has issued amendments to theMeasures for the Administration of the Takeover of Listed Companies 《上市公司收购管理办法》, in an attempt to stimulate the current market status and improve investor confidence.
The amendments to Article 63 encourage listed-companies' shareholders to increase their stake. Previously, certain investors were required to apply for prior approval if they planned to increase their holdings. The amended Article has removed such a procedure, so that the application can be submitted after investors have increased their shares.
“It may make it much easier and flexible for controlling shareholders or majority shareholders to increase their shares,” said James Weng, partner at Llinks Law Offices. “This will be helpful to the current stock market status.”
However, Zhang Yan, partner at HaoliWen PRC Attorneys, said the amendments could allow investors to buy shares at lower prices before completing the share-increase and sell them at higher prices shortly after the information is publicized. “No one except for the controlling shareholders know about the details of any share-increase,” said Zhang. “[This could] harm investors' interest.”
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