Chinese regulator preps for market clampdown
The China Securities Regulation Commission (CSRC) has promised a greater crackdown on fraud, insider trading and market manipulation in its financial markets.
Yi Huiman, chairman of the CSRC, told an event this week that the watchdog would be reforming the way companies operate and trade in an effort to repair the reputation Beijing may have lost due to a series of accounting scandals.
According to a Reuters report, Yi said that China will take greater action on brokers, accountants, and law firms who give advice leading to fraudulent actions.
He added that the country would be bringing into play a new registration system to improve transparency during initial public offerings and the disclosure of relevant financial information.
Scandals at accounting firms Kangmei Pharmaceutical and Kangde Xin Composite Material Group involved the inflation of revenues and bank deposits.
Yi said that the CSRC would maintain close communication with its overseas counterparts to improve regulatory collaboration.
The CSRC has authority in China to oversees China’s nationwide centralised securities supervisory system, and has the power to regulate and supervise securities issuers, as well as to investigate, and impose penalties.
Back in October 2019 it revealed that it would be abolishing foreign ownership restrictions on futures, securities, and fund management companies.
The announcement was swiftly followed by PayPal becoming the first foreign company to gain a Chinese payments licence.