China Securities Regulatory Commission, Supplementary Provisions on Share Buyback by Listed Companies through Centralised Competitive Trading

中国证券监督管理委员会关于上市公司以集中竞价交易方式回购股份的补充规定

November 10, 2008 | BY

clpstaff &clp articles &

Share buyback by listed companies made easier.

Clp Reference: 3710/08.10.09 Promulgated: 2008-10-09 Effective: 2008-10-09

Promulgated: October 9 2008
Effective: As of date of promulgation

Main Contents: Article 1 of the Supplementary Provisions specifies that if a listed company is to buy back shares through centralised competitive trading, a resolution shall be made by the board of directors and the same shall be submitted to the shareholders' general meeting for approval. The independent directors of a listed company shall issue an independent opinion on the share buyback.

The listed company shall announce the resolution on the share buyback made by the shareholders' general meeting on the day following the resolution, inform creditors in accordance with the law, submit relevant materials to the China Securities Regulatory Commission and the stock exchange for record filing and publish the buyback report at the same time (Article 5). The price for share buyback may not be the upper price limit of the company's shares on the same trading day (Article 7).

No share buyback of a listed company is allowed for the following periods:

(1) the 10 trading days before the disclosure of the listed company's regular report or results update; or

(2) the period from the day of occurrence of a material event that could seriously affect the company's share price or from the decision-making process thereof to two trading days after the lawful disclosure thereof (Article 9).

Fund-raising by means of a share offering is not allowed during the share buyback period (Article 10).

Repealed Legislation: Provisions on share buyback through centralised competitive trading of the Measures for the Administration of the Buyback by Listed Companies of Their Public Shares (Trial Implementation), Jun 16 2005, CLP 2005 No.6 p.35

clp reference:3710/08.10.09promulgated:2008-10-09effective:2008-10-09

This premium content is reserved for
China Law & Practice Subscribers.

  • A database of over 3,000 essential documents including key PRC legislation translated into English
  • A choice of newsletters to alert you to changes affecting your business including sector specific updates
  • Premium access to the mobile optimized site for timely analysis that guides you through China's ever-changing business environment
For enterprise-wide or corporate enquiries, please contact our experienced Sales Professionals at +44 (0)203 868 7546 or [email protected]