Upgrading the Sponsorship System: The CSRC Makes Moves to Enhance Market Quality

March 31, 2004 | BY

clpstaff &clp articles

The creation of healthy capital markets in China has come under renewed attention with recent moves by the government to promote sound corporate practices by both issuing companies and sponsors.

By Mao Baigen & Roland Sun Pu Dong Law Office

Since the end of 2003, the China Securities Regulatory Commission (the CSRC) has been preparing a new reform programme for China's existing stock issue and listing system. The specific reforms of the stock sponsorship system are echoed in the State Council's Promotion of the Reform, Opening and Stable Development of the Capital Markets Several Opinions, which were issued at the beginning of 2004. As in prior reform plans, this year's efforts are designed to improve the corporate practices of the stock issuers and reduce illegal and fraudulent activities that frequently arise in China's securities market. In addition, now the CSRC's supervisory efforts are focused on sponsors as well as stock issuers. This is reflected in the Sponsorship System for Offering and Listing of Securities Tentative Procedures (the Procedures) and its implementing circular (the Implementing Circular).