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Company managers must hold shares for minimum period
(Xinhua)
Updated: 2007-04-12 13:26 The top management of China's listed companies together with members of directorates and boards of supervisors must now hold shares in their companies for at least six months before trading them, according to a new regulation.
The move will deter company executives from making quick sales of stock for unjustified profits and also make the share market more stable, according to sources with the China Securities Regulatory Commission (CSRC). Under the regulation issued Monday, corporation managers intending to sell or purchase shares in their own companies must report their transactions to CSRC and disclose the deals to the general public. A 1,000-share cap has been instituted for single transactions by company executives and members of directorates and board of supervisors. Only 25 percent of new, immediately-tradeable shares can be sold in the year they were issued. The Shanghai and Shenzhen Stock Exchanges are expected to shortly release more specific guidelines based on the regulations. CSRC said the proportion of shares held by company management, directorates and board of supervisors was "significant information for securities investors". "Listed companies and their management must discipline themselves and abide by relevant regulations," it warned. (For more biz stories, please visit Industries)
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