Administrative Rules on Material Asset Restructuring of Listed Companies: New Rules on the China Capital Market
On April 18 2008, the CSRC promulgated the Administrative Rules on Material Asset Restructuring of Listed Companies. This represents another major move to improve the basic system of the domestic stock market in China, and signifies that the M&A and restructuring of China’s listed companies has entered a new era of standardization and development.
Date:
June 2008
Keywords (click to search): [CSRC] [Capital Market] [M&A] [restructuring] [Material Asset]
On December 10 2001, the China Securities Regulatory Commission (CSRC) announced the Notice on Several Issues Concerning Major Purchases, Sales and Exchange of Assets by Listed Companies, which came into force on January 1 2002. Although it provides several basic rules for major purchases, sales, and exchange of assets conducted by listed companies, the Notice itself was incomplete in some respects. For example, it failed to establish a complete system for regulating insider trading and information disclosure during restructuring, which has resulted in a loophole in protecting the interests of small investors fully and effectively.
In order to further regulate the material asset restructuring of listed companies, the CSRC promulgated the Administrative Rules on Material Asset Restructuring of Listed Companies (Exposure Draft) on September 17 2007. The CSRC concurrently issued the Circular on Standardization of Information Disclosure of Listed Companies and Behavior of Affiliated Parties and the Decision on Setting...
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