证券法英文版.doc

证券法英文版 (Adopted at the 6th Session of the Standing Committee of the 9th National Peoples Congress on 29 December 1998; first revision according to the Amending the Decision at the 11th Session of the Standing Committee of the 10th National Peoples Congress on 28 August 2004; second revision adopted at the 18th Session of the Standing Committee of the 10th National Peoples Congress on 27 October 2005 and effective as of 1 January 2006.)PART ONE: GENERAL PROVISIONSArticle 1: This Law is formulated in order to standardize the issuing and trading of securities, to protect the lawful rights and interests of investors, to safeguard the social and economic order and the public interest and to promote the development of the socialist market economy. Article 2: This Law applies to the issuing and trading in the Peoples Republic of China of shares, corporate bonds and such other securities as are lawfully recognized by the State Council. Issues not covered by this Law shall be governed by the provisions of the PRC, Company Law and other laws and administrative regulations. The listing and trading of government bonds and securities investment fund shares shall be governed by this Law. Where there are special stipulations in other laws and administrative regulations, such stipulations shall apply.The administrative procedures on the issuing and trading of varieties of securities derivatives shall be stipulated by the State Council according to the principles of this Law.Article 3: The issuing and trading activities of securities must be carried out in line with the principle of openness, equitability and fairness. Article 4: The parties involved in the issuing and trading of securities shall have equal legal status and adhere to the principle of voluntariness, compensation and good faith. Article 5: The issuing and trading of securities must be conducted in accordance with laws and administrative regulations. Fraudulent and insider trading and manipulation of the securities market are prohibited. Article 6: Unless stipulated otherwise by the State, securities business, and banking business, trust business and insurance business shall be operated and administered separately, and securities companies shall be established independently from banking, trust and insurance business organizations.Article 7: The State Councils securities regulatory authority shall implement centralized and unified regulation of the nationwide securities market according to law. The State Councils securities regulatory authority may establish offices as necessary, in order to perform its regulatory duties as authorized. Article 8: Subject to centralized and unified regulation by the State of securities issuing and trading activities, a Securities Association shall be established according to law to carry out self-regulation. Article 9: The State audit authority shall supervise stock exchanges, securities companies, securities registration and clearing institutions and the securities regulatory authority by audit according to law.PART TWO: ISSUING OF SECURITIESArticle 10: Public offers1 of securities must meet the conditions prescribed in laws and administrative regulations and be reported according to law to the State Councils securities regulatory authority, or the department authorized by the State Council, for verification and approval. No work unit or individual may make a public offer2 of securities if the same has not been verified and approved according to law.The following circumstances shall be deemed as a public offer:issue securities to unspecific targets;issue securities to an aggregate of 200 specific targets; orother acts of offer stipulated in laws or administrative regulations.Non-public offer of securities may not use advertising, public inducement or public method in a disguised form. Article 11: Where an issuer applies for public offer of shares or corporate bonds convertible to shares using a form of underwriting according to law or it applies for public offer of other securities that are subject to the sponsor system according to the provisions of laws and administrative regulations, it shall engage an institution with sponsor qualifications to be its sponsor.The sponsor shall comply with the business rules and industry standards, act in good faith and with due diligence, prudently verify the application documents and information disclosure materials of the issuer, and procure and guide the issuer to operate in a standardized manner.The qualifications of sponsors and the administrative procedures in relation thereto shall be stipulated by the State Councils securities regulatory authority.Article 12: Establishment of a company limited by shares to make a public offer2 of shares shall meet the conditions stipulated in the PRC, Company Law, and other conditions stipulated by the State Councils securities regulatory authority that have been approved by the State Council; and a share offering application and the following documents shall be submitted to the State Councils securities regulatory authority:the companys articles of association;the promoters agreement;the names of the promoters, the number of shares subscribed by the promoters, the types of capital contribution and the capital verification documents;the share prospectus;the name and address of the receiving bank; andthe name of the underwriting institution and the related agreement.If a sponsor is engaged in accordance with the provisions hereof, the issuance sponsorship document issued by the sponsor shall also be submitted.If the establishment of the company is subject to approval as stipulated by laws or administrative regulations, the corresponding approval document shall also be submitted. Article 13: To make a public offer2 of new shares, a company shall meet the following conditions:it has a sound and well-operated organization;it has the ability for sustained profitability and is in good financial conditions;it has no false record in its financial and accounting documents or other major illegal act in the most recent three years; andother conditions stipulated by the State Councils securities regulatory authority that have been approved by the State Council.Non-public offer2 of new shares by a listed company shall meet the conditions stipulated by the State Councils securities regulatory authority that have been approved by the State Council, and shall be reported to the State Councils securities regulatory authority for verification and approval.Article 14: To make a public offer2 of new shares, a company shall submit a share offer application and the following documents to the State Councils securities regulatory authority:the companys business licence;the companys articles of association;the resolution of the shareholders general meeting; the share prospectus;the financial and accounting reports;the name and address of the receiving bank; andthe name of the underwriting institution and the related agreement.If a sponsor is engaged in accordance with the provisions hereof, the issuance sponsorship document issued by the sponsor shall also be submitted.Article 15: The proceeds of a public offer2 of shares by a company must be used according to the purpose of the funds listed in the share prospectus. Any change in the purpose of the funds listed in the share prospectus must be approved by the shareholders general meeting. If the purpose is changed without authorization and such change is not rectified, or it is not subsequently ratified by the shareholders general meeting, no public offer2 of new shares may be carried out.Article 16: Public offers2 of corporate bonds shall meet the following conditions:in the case of a company limited by shares, the net assets are not less than Rmb 30 million, or in the case of a limited liability company, the net assets are not less than Rmb 60 million;the accumulated balance of bonds does not exceed 40% of the companys net assets;the average distributable profits in the most recent three years are sufficient to pay the interests on the corporate bonds for one year;the direction of the investment of the proceeds is consistent with the State industrial policy;the interest rate of the bonds does not exceed the interest rate level limited by the State Council; andother conditions stipulated by the State Council.The proceeds of a public offer2 of corporate bonds must be used for the verified and approved purpose and may not be used to make up for losses and non-production-related expenditures.Issuance of corporate bonds convertible to shares by a listed company shall meet the conditions for public offers1 of shares stipulated herein in addition to meeting the conditions stipulated in the first paragraph, and shall be reported to the State Councils securities regulatory authority for verification and approval.Article 17: To apply for a public offer2 of corporate bonds, the following documents shall be submitted to the department authorized by the State Council or the State Councils securities regulatory authority:the companys business licence;the companys articles of association;the method of offer of the corporate bonds;the asset valuation report and capital verification report; andother documents required by the department authorized by the State Council or the State Councils securities regulatory authority.If a sponsor is engaged in accordance with the provisions hereof, the issuance sponsorship document issued by the sponsor shall also be submitted.Article 18: No public offer2 of corporate bonds shall be made again if any of the following circumstances applies:the corporate bonds in the last public offer are not fully subscribed;there is a breach of contract or delay in payment of principals and interests in relation to the publicly offered corporate bonds or other debts, and such breach or delay is still continuing; orthere is a change in the usage of the proceeds of the public offer2 of corporate bonds in violation of the provisions hereof.Article 19: The formats and submission methods of the application documents to be submitted by issuers for an application for verification and approval of offer2 of securities according to law shall be prescribed by the authority or department responsible for verification and approval according to law. Article 20: The application documents for the issuing of securities submitted by issuers to the State Councils securities regulatory authority or the department authorized by the State Council must be truthful, accurate and complete. Securities service organizations and personnel that issue relevant documents for an issue of securities must strictly perform their statutory duties and warrant the truthfulness, accuracy and completeness of the documents they issue.Article 21: Where an issuer applies for an initial public offer of shares, it shall, after submission of the application documents, disclose the relevant application documents in advance according to the regulations of the State Councils securities regulatory authority.Article 22: The State Councils securities regulatory authority shall establish an issuance examination commission to examine applications to issue shares according to law. The issuance examination commission shall consist of professionals from the State Councils securities regulatory authority and other relevant specialists engaged from outside the said authority. The commission shall vote on applications to issue shares and state the opinion it reaches upon examination. The specific method for forming the issuance examination commission, the term of office of its members and its working procedures shall be stipulated by the State Councils securities regulatory authority. Article 23: The State Councils securities regulatory authority shall be responsible for the verification and approval of applications to issue shares in accordance with the statutory conditions. The verification and approval procedures shall be made public, and shall be subject to supervision according to law. The persons involved in the examination, verification and approval of applications to issue shares may not have a common interest with, or accept gifts directly or indirectly from, the applicant, or hold shares in which they approve of the application for issuance or have any private contact with the applicant. The verification and approval by the department authorized by the State Council of applications to issue corporate bonds shall be carried out by reference to the preceding two paragraphs.Article 24: The State Councils securities regulatory authority or the department authorized by the State Council shall make a decision on whether or not to approve the application documents for the issuing of securities upon verification according to the statutory conditions and the statutory procedures within three months from the date of acceptance thereof, excluding the time period for supplementing and amending the application materials for issue by the issuer as required. If the application documents are not approved upon verification, the reason(s) therefor shall be given. Article 25: Once an application to issue securities has been approved upon verification, the issuer shall announce the public offer2 documents prior to making the public offer2 of the securities, as prescribed in laws and administrative regulations, and make the said documents available for public access at the designated places. Prior to the announcement of the information on the issuing of securities according to law, no informed person may announce or divulge such information. Issuers may not issue securities before they announce the public offer2 documents. Article 26: If the State Councils securities regulatory authority or the department authorized by the State Council discovers that a decision it has made to approve upon verification the issuing of securities does not comply with the statutory conditions or the statutory procedures, it shall revoke the decision and discontinue the issuing if the relevant securities have not yet been issued. If the relevant securities have already been issued but not yet listed, it shall revoke the decision on verification and approval of the issuing, and the issuer shall refund the issue price plus bank deposit interest for the same period to the securities holders. The sponsor shall bear joint and several liability with the issuer, unless it is able to prove that it is not at fault. Where the controlling shareholder and de facto controlling person of the issuer are at fault, they shall bear joint and several liability with the issuer.Article 27: After shares have been issued according to law, the issuer shall itself be responsible for any change in its operation or earnings; and the investors shall themselves be responsible for any investment risks caused by such change. Article 28: Where an issuer issues securities to unspecific targets, and such securities shall be distributed by a securities company according to the provisions of laws and administrative regulations, the issuer shall enter into a distribution agreement with the securities company. Securities distribution business shall be carried out by means of distribution on an agency basis or underwriting. Distribution of securities on an agency basis means the method of distribution whereby the securities company sells securities as the agent of the issuer and, at the end of the distribution period, returns to the issuer all the securities that remain unsold. Underwriting of securities means the method of distribution whereby the securities company purchases, pursuant to an agreement, all the securities issued by the issuer or whereby it purchases, at the end of the distribution period, all the securities that remain after the sale. Article 29: An issuer that makes a public offer2 of securities has the right to independently select according to law a securities company to carry out distribution. Securities companies may not solicit securities distribution business by means of improper competition. Article 30: To distribute securities, a securities company shall enter into an agreement for distribution on an agency basis or an underwriting agreement with the issuer. Such agreement shall include the following: the names and domiciles of the parties and the names of their legal representatives; the class, quantity, amount and issuing price of the securities to be distributed on an agency basis or underwritten; the period and the initial and final dates for distribution on an agency basis or underwriting; the method and date of payment for distribution on an agency basis or underwriting; the fee for distribution on an agency basis or underwriting and the method of settlement thereof; liability for breach of contract; and other matters prescribed by the State Councils securities regulatory authority.Article 31: When distributing securities, securities companies shall examine the truthfulness, accuracy and completeness of the public offer2 documents. If they find that such documents contain any falsehood, misleading statement or major omission, they may not carry out sales activities. If the sale of securities has already begun, the sales activities must be discontinued immediately and rectification measures shall be adopted. Article 32: Securities to be offered3 to unspecific targets with a total face value exceeding Rmb 50 million shall be distributed by a distribution syndicate. The distribution syndicate shall be composed of a securities company acting as lead distributor and of securities companies acting as participants in the distribution. Article 33: The maximum period for distribution of securities on an agency basis or