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Thursday, 25 September 2008
China Bourses Relax Rules On Related-Party Stock Transactions
SHANGHAI (Dow Jones)--China’s stock exchanges said Thursday they have relaxed rules on related-party transactions, in a bid to help ease restrictions on share repurchases.
China Bourses Relax Rules On Related-Party Stock Transactions
SHANGHAI (Dow Jones)--China’s stock exchanges said Thursday they have relaxed rules on related-party transactions, in a bid to help ease restrictions on share repurchases.
Related parties, or those who own more than 30% of a listed firm, will be allowed to buy shares in the listed companies up to 10 days prior to the release of their earnings forecasts, the Shenzhen Stock Exchange and Shanghai Stock Exchange said.
China requires listed companies to issue disclosures if they expect earnings to rise or fall more than 50%.
The exchanges also shortened the ban on related-party share purchases before earnings reports. Shareholders of a listed company can now raise their stake in the company up to 10 days before earnings reports are released, shorter than the previous ban of one month.
The bourses said in the statements published in the state-run China Securities Journal that the changes take effect immediately.
After Beijing urged state companies last week to buy shares in their listed units, China’s securities regulator said Sunday share repurchases on the open market would no longer require approval from the regulator.
Beijing had also cancelled the stamp duty on stock purchases and pledged that an investment arm of the country’s $200 billion sovereign wealth fund would lift its holdings in major listed banks, as part of efforts to boost sagging share prices.
So far, a group of listed companies, including China’s three major banks, PetroChina Co. and China Coal Energy Co., have disclosed share buybacks by their parents.
China’s benchmark Shanghai Composite Index has risen 17% since Friday to Wednesday’s close, but is still off 64% from its peak of 6124.04 in October.
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China Bourses Relax Rules On Related-Party Stock Transactions
SHANGHAI (Dow Jones)--China’s stock exchanges said Thursday they have relaxed rules on related-party transactions, in a bid to help ease restrictions on share repurchases.
Related parties, or those who own more than 30% of a listed firm, will be allowed to buy shares in the listed companies up to 10 days prior to the release of their earnings forecasts, the Shenzhen Stock Exchange and Shanghai Stock Exchange said.
China requires listed companies to issue disclosures if they expect earnings to rise or fall more than 50%.
The exchanges also shortened the ban on related-party share purchases before earnings reports. Shareholders of a listed company can now raise their stake in the company up to 10 days before earnings reports are released, shorter than the previous ban of one month.
The bourses said in the statements published in the state-run China Securities Journal that the changes take effect immediately.
After Beijing urged state companies last week to buy shares in their listed units, China’s securities regulator said Sunday share repurchases on the open market would no longer require approval from the regulator.
Beijing had also cancelled the stamp duty on stock purchases and pledged that an investment arm of the country’s $200 billion sovereign wealth fund would lift its holdings in major listed banks, as part of efforts to boost sagging share prices.
So far, a group of listed companies, including China’s three major banks, PetroChina Co. and China Coal Energy Co., have disclosed share buybacks by their parents.
China’s benchmark Shanghai Composite Index has risen 17% since Friday to Wednesday’s close, but is still off 64% from its peak of 6124.04 in October.
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