China's Regulators Take On Insider Trading
July 11, 2019 | BY
Marilyn RomeroNew court interpretations and a series of court cases with stiff sentences reflect Chinese authorities' determination to bring insider trading to heel.
On June 28, China's Supreme People's Court and Supreme People's Procuratorate jointly issued a judicial interpretation to protect investors' rights and ensure a healthy market. Securities and law professionals have generally welcomed the new judicial interpretation that eliminates gray areas in Chinese criminal law regarding insider trading, as part of its efforts to address the growing occurrence of such trading malpractices.
The judicial interpretation makes specific stipulations on what qualifies as “other undisclosed information” in insider trading, as regulators seek to end the malaise of trading on undisclosed information, particularly the practice known as “rat trading”, also known as front-running in the U.S. and European markets.
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