Legislation roundup: Equity incentives, securities investments and insurance company guidelines
March 21, 2013 | BY
clpstaff &clp articles &The CSRC has issued draft Provisions over equity incentives and restraint mechanisms of securities companies. The Commission has also released Measures for the sale of securities investment funds, while the CIRC has issued guidelines for the development plans of insurance companies
Securities companies
China Securities Regulatory Commission, Provisions for the Administration of the Equity Incentive and Restriant Mechanism of Securities Companies (Draft for Comments)
The Provisions specify that the recipients of the employee shareholding scheme of securities companies are directors, senior management personnel and other employees excluding independent directors and supervisors. Employees may hold company shares from the incentive scheme through a trust plan, company or partnership.
See the digest for more details.
Further reading
Tentative Measures for the Administration of Employee Shareholding Schemes of Listed Companies (Draft for Comments), Jul/Aug 2012
Will share ownership decrease employee turnover rates?, Sep/Oct 2012
Securities investment funds
China Securities Regulatory Commission, Measures for the Administration of the Sale of Securities Investment Funds (2nd Revision)
The Measures allow futures companies and insurance companies to sell securities investment funds. Application procedures for the qualifications to sell securities funds are now simplified to just a registration system. Branches of securities sales institutions instead of their head office may also directly sign sales contracts with the fund manager.
Further reading
PRC Securities Investment Fund Law (Revised), Mar/Apr 2013
Measures for the Administration of the Sale of Securities Investment Funds (Revised), Sep 2011
Insurance companies
China Insurance Regulatory Commission, Guidelines for the Administration of Development Plans of Insurance Companies
The CIRC requires insurance companies to formulate development plans detailing their strategic objectives, business development, company development, solvency management, capital management, risk management, basic management and security measures. Insurance companies are also required to submit to the CIRC a report on the implementation of the development plan and a comprehensive evaluation by the end of April specifying premium revenue, total assets, profit ratio and solvency level.
See the digest for more details.
Further reading
Provisions for the Administration of the Solvency of Insurance Companies, Nov 2008
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