China Steps Up Oversight of Firms to Strengthen Market Development
The CSRC announced it would investigate five listed firms suspected of information disclosure violations after failing to publish annual reports on schedule.
SHANGHAI (Reuters) - China's capital markets have experienced fluctuations thanks to the "external environment" but regulators are working to improve the quality of listed firms which will underpin the market, the head of China's securities regulator said on Saturday.
Yi Huiman, chairman of the China Securities Regulatory Commission (CSRC), made the comments at an annual gathering of the China Association For Public Companies, according to a transcript of his speech published on the regulator's website.
China's stock market has been suffering losses amid escalating trade friction with the United States, which ratcheted up in recent days after talks between the world's two largest economies failed to resolve differences.
Yi said the regulator would step up supervision of listed companies with a focus on governance, including information disclosure and internal controls, and would not tolerate collusion between intermediary firms and listed companies.
Investors have become increasingly concerned about poor governance after disclosures by firms such as Kangmei Pharmaceutical, which revealed last week it had overstated its 2017 cash holdings by $4.4 billion.
The CSRC announced on Friday it would investigate five listed firms suspected of information disclosure violations after failing to publish annual reports on schedule.
The five firms are ShangHai ZhongYiDa Co. Ltd., Xinjiang Yilu Wanyuan Industrial Investment Holding Co. Ltd., Zhejiang Great Southeast Co. Ltd., vaccine maker Changsheng Bio-technology Co. Ltd., and Chengdu Huaze Cobalt & Nickel Material Co. Ltd.
Trade in their shares has been suspended due to the investigation, the CSRC said in a posting on its website.
Listed companies' annual reports are a key part of information disclosure, and an important factor for investors when they make decisions.
The CSRC said would maintain its crackdown on various types of information disclosure violation and it urged listed companies to fulfill information disclosure obligations in a timely and lawful manner to promote the improvement of the quality of listed companies.