Chinese shares end higher on Tuesday
(chinadaily.com.cn/Xinhua)Updated: 2007-03-20 16:11
Listed companies must not speculate with funds raised from
capital markets: CSRC
China's securities watchdog has issued a
new regulation which prevents listed companies investing funds raised through
the sale of stocks and bonds in securities transactions, such as stocks and
related derivatives, and tradable bonds.
The regulation has been issued
in response to some listed companies investing raised capital in risky ventures
rather than core business, which could prove hazardous, said an official with
the China Securities Regulatory Commission.
The regulation reiterates
that financing is the basic function of the securities market. Fund raising from
the securities market is intended to gain more capital for the listed companies
to achieve a better performance while at the same time offering more returns to
the investors.
The new ruling also requires listed companies to improve
its methods of storing and using the raised funds and to disclose information in
a timely fashion. It also calls on directors, supervisors and senior managerial
staff of listed companies to safeguard their company's assets.
Companies
and related staff will be held responsible for serious violation of the new
ruling, the official said.
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