The listed companies on the Shanghai Stock Exchange (SSE), silent during long-term trading suspension, should announce every Monday, from now on, the progress of issues causing trading suspension.
To improve the degree of transparency of information disclosure by listed companies during long-term trading suspension, the SSE Listed Company Department has recently made supplementary requirements to information disclosure during long-term trading suspension according to the "Measures on Administration of Information Disclosure of Listed Companies" and the "SSE Stock Listing Rules" formulated by the China Securities Regulatory Commission. Besides, the "Notice of Strengthening Listed Companies' Information Disclosure during Long-term Trading Suspension", formulated by the SSE Listed Company Department, is to be officially issued on the section of Listed Companies on the SSE website and to be implemented as of today.
According to the notice, listed companies, whose stock trading has been in suspension for 5 trading days by the notice's issuance day and will still be suspended next week, should publish from next Monday (September 24) an announcement every Monday on progress of issues leading to continuous trading suspension before trading resumption. They should clarify the progress of issues being examined by relevant authorities. If relevant issues are in substantial progress and reach the requirements of information disclosure, listed companies should fulfill the obligations of information disclosure in time and disclose to investors the uncertainties in the issues. Upon the agreement of the SSE Listed Company Department, they can apply for trading resumption.
Secondly, after the issuance of the notice, listed companies, who apply for continuous trading suspension to the SSE Listed Company Department according to regulations, should, according to the above requirements, publish progress announcements during trading suspension in time after 5 trading days' continuous trading suspension.
According to an official from the SSE Listed Company Department, formulating the notice and requiring listed companies to publish progress announcements during trading suspension in time aims to caution the companies whose stock trading suspension lasts for several months but without any further information. As a result, investors feel unsatisfied with these silent companies. Therefore, the SSE sets rules to strengthen the listed companies' information disclosure during long-term trading suspension and acquaints investors with progress of the companies' issues. The official stressed that the notice aimed at all the SSE listed companies rather than ST companies only.
Market insiders think highly of the notice. Statistics by the beginning of August show that the suspension period of stock trading of 11 listed companies on the SSE and the Shenzhen Stock Exchange has exceeded 6 months. Investors, especially those heavily holding their stocks, feel unfair. Trading suspension is a system to protect public investors. However, long-term trading suspension but without any further information disclosure damages investors' interest. At present, the A-share market changes quickly, with all systems improving. However, no definite regulations are available concerning issues of long-term trading suspension, especially in terms of reorganization and equity division reform. Thus, some companies suspend or even intentionally suspend trading for a long time. The SSE takes the lead in making regulations on information disclosure for these companies, with an aim to restrict the deliberate long-term trading suspension as well as to protect investors' interest.
Source:Shanghai Securities News
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