Legislation roundup: Public securities funds, shareholder disclosure and insurance groups

Capital markets

China Securities Regulatory Commission, Measures for the Administration of the Operation of Publicly Offered Securities Investment Funds
中国证券监督管理委员会公开募集证券投资基金运作管理办法

The Measures change the review of public fund products from the approval system to the registration system. The Measures specify that funds with at least 80% of their assets invested in stocks, are stock funds; those with at least 80% of their assets invested in bonds, are bond funds; and those with at least 80% of their assets invested in the units of other funds, are funds of funds.

See the full translation.

Further reading
PRC Securities Investment Fund Law (Revised)
Tentative Provisions for the Engagement in the Public Securities Investment Fund Management Business by Asset Management Firms

Shanghai Stock Exchange, Memorandum No.13 on Routine Information Disclosure by Listed Companies: Matters to be Disclosed in Advance When a Shareholder of a Listed Company Reduces Its Shareholding (Draft for Comments)
上海证券交易所上市公司日常信息披露工作备忘录第十三号上市公司股东减持股份预披露事项 (征求意见稿)

When a shareholder holding 5% of the shares is to reduce its shareholding, it is required to disclose the same in advance. When the shareholder discloses its shareholding reduction plan, it is required to specifically disclose the reason for reducing its shareholding, whether the contemplated reduction is consistent with its relevant previously disclosed intentions and/or undertakings, and such specific arrangements as the quantity by which it proposes to reduce its shareholding, the time period therefor, the method of reduction and the pricing of the shares involved in the reduction.

See the digest for more details.

Further reading
PRC Securities Law (Amended)
PRC Company Law


Insurance

China Insurance Regulatory Commission, Guidelines for Consolidated Oversight of Insurance Groups (Draft for Comments)
中国保险监督管理委员会保险集团并表监管指引 (征求意见稿)

The Draft proposes that the following institutions, other than the member companies, invested in by an insurance group are to be made subject to consolidated oversight:

(1) where the size of assets of an institution invested in accounts for a relatively small percentage of the overall assets of an insurance group but the risks engendered thereby are sufficient to have a material impact on the financial position and risk level of the insurance group; or

(2) where the harm and losses caused by the compliance risk and reputation risk brought by an institution invested in are sufficient to have a material impact on the reputation of the insurance group.

See the digest for more details.

Further reading
Provisions for the Administration of Insurance Companies
Measures for the Administration of Insurance Group Companies (Trial Implementation)