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BIZCHINA / Center
CSRC to restrict unqualified trading accounts
By Ding Qi (chinadaily.com.cn)
Updated: 2007-08-14 16:29
The China Securities Regulatory Commission (CSRC), in a circular to
financial institutions and brokers, called for a complete clearance and
standardization of third-party managed stock accounts, the financial web
portal jrj.com reported on Tuesday.
According to the circular, regulators and securities companies should
suspend trading of accounts inactive for a long time and with assets
below requirements. These accounts can be re-activated only upon their
holders' request and after verification by the securities regulators.
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For other unqualified trading accounts with false registration
information or transaction irregularities, CSRC also laid down another
series of measures.
According to the circular, China Securities Depository and Clearing Corp
should limit unqualified accounts from stock trading, designation
transfers and guaranteed funds movement until they meet requirements for
eligible accounts. The clearing body is also authorized to close
unqualified accounts without outstanding assets.
Meanwhile, both exchanges in Shanghai and Shenzhen are to help restrict
irregular transactions involving unqualified accounts. If an account
fails to return to normal in time, bourses should suspend its trading,
although protective measures are needed accordingly to minimize the
relevant impact on the stock market, the circular said.
In addition, securities regulatory bureaus from all regions should work
out a detailed schedule urging brokers to weed out the existing
unqualified accounts in time and prevent adding new ones, according to
the circular.
(For more biz stories, please visit Industry Updates)
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