Shanghai Stock Exchange Fuels Investor Suitability Management - The “SSE Provisional Measures On Investor Suitability Management” (The “Provisional Measures” For Short) Is Released And Implemented

The Shanghai Stock Exchange (SSE) released and implemented the “SSE Provisional Measures on Investor Suitability Management” on March 26 for guiding investors to rationally participate in securities investment and protecting their legal rights and interests, with an aim of implementing the requirements of the China Securities Regulatory Commission (CSRC) for investor suitability management, regulating the investor suitability management on the SSE market, and strengthening the protection for legal rights and interests of investors under the backdrop of the acceleration of product and business innovation.

There are in total 20 articles in 4 chapters in the “Provisional Measures”, which prescribes the main content in the investor suitability management work on the SSE market from the perspective of the exchange’s self-disciplinary management and service. The “Provisional Measures” has pointed out the purpose of its formulation, the scope of its application, and the principle of “Let the buyer beware” on the part of the investors. It has also clarified the content of investor suitability management, the setting of market-entry conditions for investors, the classification of investors, the requirements for securities companies in terms of the implementation of investor suitability management, as well as put more emphasis on providing education, risk disclosure, and others for the investors with newly opened accounts and those participating in the trading of new shares or new businesses. The “Provisional Measures” has also prescribed that the SSE should build and improve the system of investor suitability management for investors on the SSE market, guide and supervise securities companies in terms of the implementation of investor suitability management, launch education programs and risk alerts for investors, and provide educational services for them in all kinds of ways. Moreover, the “Provisional Measures” has stated that the SSE is supposed to regulate and check the investor suitability management of securities companies, and impose relevant regulatory measures or disciplinary punishments on the securities companies violating the SSE’s rules on investor suitability management.

The release and implementation of the “Provisional Measures” will be conducive to protecting the rights and interests of investors fundamentally, ensuring the steady progress of the securities industry’s innovative development, as well as facilitating the maturation of China’s capital market. It is also learnt that the SSE will drive the implementation of the “Provisional Measures” in the following three aspects, for the purpose of the overall enhancement of the investor suitability management on the SSE market. First, the SSE will constantly improve the system of investor suitability management on the SSE market by fully considering the requirements for investor suitability in design of schemes and formulation of rules, particularly for new products and businesses, and fixing details for the investor suitability management. Second, the SSE will provide pertinent services for securities companies and investors. Third, the SSE will improve the supervision over its members in terms of the investor suitability management work.