Legislation roundup: Employee shares, factoring projects and insurance shareholder restrictions
August 10, 2012 | BY
clpstaff &clp articles &The China Securities and Regulatory Commission has issued draft Measures allowing employees to enjoy shareholding schemes. The China Insurance and Regulatory Commission has also released Measures disallowing shareholders of insurance companies to sell privately offered bonds to their own company
Stock Option Plans
China Securities Regulatory Commission, Tentative Measures for the Administration of Employee Shareholding Schemes of Listed Companies (Draft for Comments)
The total number of shares involved in all the valid employee shareholding schemes of a listed company may not exceed 10% of the company's total share capital. Employees may not use more than one third of their family financial assets to participate in such schemes and the lock-up period may not be less than 36 months.
See the digest for more details.
Further reading:
China Advances its Tax Regime for Employee Stock Options
Insurance
China Insurance Regulatory Commission, Measures for the Administration of Controlling Shareholders of Insurance Companies
A controlling shareholder of an insurance company is not allowed to sell its privately offered bonds to its insurance company. The controlling shareholder should also ensure that its insurance company will not be purchasing more than 10% of an issuance of its publicly offered bonds.
See the digest for more details.
Further reading:
Factoring
Ministry of Commerce, Circular on Work Relevant to Pilot Factoring Projects
Establishment of factors is now allowed in China in the Shanghai Pudong New Area and Tianjin Binhai New Area. Factor applicants should have the necessary financial resources and may not use loans or funding entrusted by third parties. In principle, factors should be an independent business and may not engage in mixed businesses.
Further reading:
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