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Securities Law Under Scrutiny

China's top legislative body will dispatch four groups of senior legislators to check the implementation of the 2-year-old Securities Law next week in preparation for future amendments.

The inspection tour will look at ways to amend the law, said Li Peng, chairman of the Standing Committee of the National People's Congress (NPC).

Li was speaking at the first gathering of the law inspection groups, a meeting held yesterday in Beijing.

The securities market is one example of the nation's reform and opening-up policies and an important part of the socialist market economy. The securities market now plays a positive role in raising social funds, readjusting economic structures, changing the operational mode of enterprises and promoting the national economy, Li said.

But the market is in urgent need of further rectification.

There are more than 1,100 listed companies in China, with a total market value of nearly 5 trillion yuan (US$604.5 billion).

The Securities Law came into force in July 1999.

The promulgation of the law was taken as a milestone in the nation's development of its securities market. However, improvements need to be made to prevent fraud, increase transparency and improve the quality of listed companies, he said.

Legislators major task is to solve problems in the securities market to keep order and protect the interests of investors, said Cheng Siwei, vice-chairman of the NPC Standing Committee.

Cheng said the inspections will focus on six areas: the formulation of administrative regulations, the operation of the unified supervision system required by the law, and the performance of the law relating to listed companies and stock companies, including the exposure of information.

They will also look at the protection of investors, especially individual investors, problems that have arisen in the market and suggestions on how to improve the law.

The inspection groups, headed by Cheng, will visit Shanghai, Shenzhen, Wuhan and Chengdu. Beijing, Guangzhou, Xiamen, Lanzhou and Harbin will conduct self-inspections on the performance of the law and report separately to the NPC Standing Committee.

(China Daily 05/12/2001)

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