In order to promote the development of the bond market, protect legitimate rights and interests of investors, and guard against risks on the bond market, the Shanghai Stock Exchange (SSE) has amended the "SSE Measures for Investor Suitability Management of Bond Market" (the former “Measures” for short), forming the "SSE Measures for Investor Suitability Management of Bond Market (Amended in 2017)" (the amended "Measures" for short, see attachment). With an aim to make transitional arrangements for the application of the former and the present measures, the SSE hereby notifies relevant issues as follows:
1. Issuers, underwriters and securities business institutions should establish the system on investor suitability management, conduct front-end technology control, and perform investor suitability management according to the amended "Measures".
Securities business institutions should appraise and report the qualified investors according to the standards prescribed in the amended "Measures", complete the adjustment work for the existing qualified investors, and submit the account list of qualified investors through the SSE's website before July 1, 2017.
2. For corporate bonds, enterprise bonds and asset-backed securities (the bonds for short) traded or transferred at the SSE before the issuance of this notice, or bonds applying, from the issuance date of this notice till July 1, 2017 (exclusive), for trading or transfer at the SSE, the investor suitability management during their duration period should be implemented in the following principles:
(1) From today till July 1, 2017 (exclusive), bond investor suitability management will be subject to the former "Measures".
(2) The amended "Measures" will be applicable to bond investor suitability management from July 1, 2017. Regarding investors having purchased bonds according to the former "Measures" before implementation of the amended "Measures", if unable to meet relevant regulations on bond investor suitability management after implementation of the amended "Measures", they will no longer be allowed to purchase such bonds; however, they may choose to sell out or continue to hold their bonds.
3. Investors participating in financing transactions through collateralized repo of bonds and collateralized agreed repo transactions of bonds shall be the institutional investors among the qualified investors meeting the requirements in the amended "Measures". If individual investors and institutional investors not meeting the requirements in the amended "Measures" participate in financing transactions through collateralized repo of bonds and collateralized agreed repo transactions of bonds, they should close out all their collateralized-repo financing transactions and collateralized agreed repo transactions before December 9, 2017, and the unexpired balances of the repo transactions shall not be increased during this period.
4. The amended "Measures" shall be implemented from July 1, 2017, and the former "SSE Measures for Investor Suitability Management of Bond Market" (Shang Zheng Fa [2015] No. 51 Document) shall be revoked at the same time. In case of any inconsistency between other regulations issued by the SSE and the amended "Measures", the amended "Measures" should prevail.
Attachment: SSE Measures for Investor Suitability Management of Bond Market (Amended in 2017) (Chinese Version Only)
