Approved by the China Securities Regulatory Commission (CSRC), the Shanghai Stock Exchange (SSE) has recently issued the “SSE Measures for Implementation of Review” (the Measures for short), further improving the review system and strengthened the protection for the legitimate rights and interests of the self-regulation entities.
The review system is an internal remedy system where a stock exchange, on the basis of the application of a self-regulation entity, reviews the relevant self-regulatory decision that has been made. In accordance with the provisions related to the review system of the stock exchanges in the “Securities Law”, the SSE issued the “SSE Interim Provisions on Review System” in 2007, and established a review committee mainly composed of external experts to fulfill the responsibility of examination for the matters to be reviewed. The committee has played the role of rights relief in the practice of delisting listed companies. In recent years, with the capital market further regulated in a stricter and all-round way according to law, the SSE, as a self-regulatory institution, has taken more responsibilities for frontline regulation in the capital market by vigorously taking more disciplinary actions and other punitive measures for violators. While stepping up regulation and intensifying punishment on the violations, the SSE finds it necessary to further improve the review and other internal remedy mechanisms, so as to ensure the standardized and fair procedures of self-regulation and fully protect the legitimate rights and interests of the self-regulation objects. To this end, on the basis of summarizing the practical experience, the SSE has revised the “SSE Interim Provisions on Review System” and transformed the interim provisions into the formal rules, thus forming the Measures.
The Measures has revised and improved the existing review system in the following two aspects: on the one hand, the Measures has expanded the scope of the review matters, with an aim to provide more self-regulation objects with the access to rights relief and further standardize the SSE’s self-regulation. The Measures has expanded the decision on public censure for the members and the parties concerned in the existing review matters to all the objects of self-regulation. Moreover, it has included in the review scope the relatively severe disciplinary treatment decisions such as identification of those unqualified for directors, supervisors or senior management of a listed company or unqualified investors. Thus, the Measures has included in the review scope the vast majority of disciplinary treatment decisions and the self-regulatory decisions related to listing such as refusal, suspension and termination of listing. On the other hand, the Measures has improved the examination procedures for the review, and enhanced the authority and representativeness of the review decisions as well as the convenience in applying for review. To improve the representativeness of the review opinions and the authority of the review decisions, the Measures has increased the number of the committee members attending each review meeting from 5 to 7, so as to form the review decisions from extensive opinions of more committee members. In addition, to standardize the procedures, the Measures has clearly set the review time limits for all review matters and the principle that the implementation of the original decisions shall not be suspended during the review period. Furthermore, to facilitate the self-regulation objects’ applications for review, the Measures has stipulated that the channels for submitting the applications and the contact information of the review working group shall be announced on the SSE website.
After the issuance and implementation of the Measures, the SSE will strictly carry out the rules in its self-regulatory work, accept and examine the qualified applications for review and effectively strengthen the protection for the procedures and substantive rights and interests of the self-regulation objects.
