Beijing, 6 Jul (Xinhua) recently, the General Office of the CPC Central Committee and the General Office of the State Council issued the "opinions on strictly cracking down on illegal Securities activities in accordance with the Law," and issued a circular requiring all localities and departments to conscientiously implement them in the light of reality.

The main contents of the "opinions on cracking down on illegal Securities activities in accordance with the Law" are as follows.

Cracking down on illegal activities of securities is an important guarantee to maintain the order of the capital market and give full play to the hub function of the capital market. Since the 18th CPC National Congress, all parties concerned have conscientiously implemented the decisions and arrangements of the CPC Central Committee and the State Council, solidly promoted the building of a judicial system for law enforcement in the capital market, cracked down on illegal activities in the capital market in accordance with the law, and safeguarded the legitimate rights and interests of investors, and achieved positive results. At the same time, under the background of profound changes in the economic and financial environment and the continuous deepening of capital market reform and opening up, illegal acts in the capital market are still more prominent, cases are more difficult to investigate and deal with, and relevant law enforcement and judicial work is facing new situations and new challenges. In order to further promote the high-quality development of the capital market, we now put forward the following suggestions on cracking down on illegal securities activities in accordance with the law.

I. overall requirements

(1) guiding ideology. Under the guidance of Xi Jinping's thought of socialism with Chinese characteristics in the new era, we should fully implement the spirit of the 19th CPC National Congress and the second, third, fourth and Fifth Plenary sessions of the 19th CPC Central Committee, adhere to the direction of marketization and the rule of law, and adhere to the direction of building a system, non-intervention and zero tolerance. we will strengthen the construction of the basic system of the capital market, improve the system and mechanism for strictly cracking down on illegal securities activities in accordance with the law, improve the judicial efficiency of law enforcement, and effectively prevent and defuse major risks. To provide strong support for speeding up the construction of a standardized, transparent, open, dynamic and resilient capital market.

(2) working principles

Adhere to the requirement of zero tolerance. We will strictly investigate and deal with securities crimes in accordance with the law, strengthen the investigation and handling of major and important cases, strengthen integrity restraint and punishment, and strengthen the deterrent effect.

-- adhere to the principle of the rule of law. Follow the principles of openness, fairness and impartiality, adhere to strict law enforcement and impartial administration of justice, unify standards and standardize procedures, improve the level of specialization, enhance transparency, and constantly enhance public credibility.

-- adhere to overall planning and coordination. We will strengthen the coordination of the work of securities and futures regulatory institutions with public security, judicial, market supervision and other departments and relevant localities to form a joint force to effectively crack down on illegal securities activities.

-- adhere to the bottom line thinking. We will strictly crack down on illegal securities activities in accordance with the law with effectively preventing and defusing risks, safeguarding national security and social stability, strengthen risk investigation in key areas, strengthen source risk prevention and control, and strictly prevent risk superposition, resonance, amplification and escalation.

(3) main objectives. By 2022, important progress will be made in the construction of the legal liability system for illegal crimes in the capital market, the judicial system for law enforcement and coordination mechanisms for strictly cracking down on illegal activities of securities in accordance with the law have been initially established, and the cost of securities crimes has increased significantly. The frequent occurrence of major illegal and criminal cases has been effectively curbed, the relief channels for investors' rights have been more smooth, and the order of the capital market has been significantly improved. By 2025, the legal system of the capital market will be more scientific and complete, the judicial system of securities law enforcement with Chinese characteristics will be more sound, the transparency, standardization and credibility of securities law enforcement justice will be significantly improved, and the interface between administrative law enforcement and criminal justice will be efficient and smooth. a good capital market ecology of upholding law and trustworthiness, standardization and transparency, openness and inclusiveness has been formed in an all-round way.

Second, improve the legal liability system of illegal crimes in the capital market.

(4) to improve the securities legislative mechanism. Make full use of legal amendments, legal interpretations, authorization decisions and other forms to improve the efficiency of legislation in the field of securities and enhance the timeliness of legal supply.

(5) to increase the intensity of criminal punishment. We will implement the Amendment to the Criminal Law (11), simultaneously revise the standards for filing and prosecuting relevant criminal cases, and improve relevant criminal judicial interpretations and judicial policies.

(6) improve the administrative legal system. We will implement the newly revised Securities Law and speed up the formulation and revision of supporting laws and regulations, such as the regulations on the supervision and administration of listed companies, the regulations on the supervision and administration of securities companies, the new regulations on the supervision and administration of the third board market, and the measures promised by the parties involved in the administrative law enforcement of securities and futures, so as to greatly increase the cost of violating the law. We will speed up the formulation of the futures law and make up for the shortcomings of the supervision and law enforcement system of the futures market.

(7) improve the civil compensation system. We will step up efforts to promote the implementation of the litigation system for representatives of securities disputes. Amend the judicial interpretation of civil compensation caused by false statements and cancel the pre-procedure of civil compensation litigation. We will carry out a pilot arbitration system in the securities industry.

(8) strengthen the market restraint mechanism. We will promote the reform of the delisting system, strengthen delisting supervision, strictly implement the compulsory delisting system, study and improve the supervision and risk disposal system of delisted companies, and improve the virtuous circle mechanism of the survival of the fittest of listed companies. We will strengthen supervision over the issuance and operation of securities investment funds, implement market withdrawal for fund managers who seriously violate laws and regulations, do a good job in risk disposal, and protect the legitimate interests of fund holders. We will improve the self-regulatory system of trading venues and trade associations over securities violations.

Third, establish and improve the law enforcement judicial system and mechanism to crack down on illegal securities activities in accordance with the law.

(9) to establish a coordination mechanism for cracking down on illegal activities in the capital market. We will set up a coordination working group to crack down on illegal activities in the capital market, strengthen the coordination of major cases, improve the information sharing mechanism, promote the formulation of important rules, and coordinate and solve major problems.

(10) to improve the investigation system and mechanism of securities cases. We will further give full play to the institutional advantages of the Securities Crime investigation Bureau of the Ministry of Public Security assigned to the China Securities Regulatory Commission, and improve the administrative criminal law enforcement cooperation mechanism in such aspects as clue research and judgment, data sharing, intelligence-guided investigation, and coordinated handling of cases. We will further optimize the allocation of resources for the establishment of securities crime investigation under the Ministry of Public Security and strengthen the construction of front-line investigation forces.

(11) to improve the procuratorial system and mechanism of securities cases. According to the number of cases and staffing, this paper studies the establishment of a financial crime team within the procuratorial organs. We will explore the establishment of a working mechanism for procuratorial work stationed in the CSRC, and strengthen the cooperation between the Supreme people's Procuratorate, the CSRC and the Ministry of Public Security by participating in case clues to discuss and decide, and carry out crime prevention. We will strengthen the professional construction of procuratorial personnel in the securities field. When suspected major criminal cases are transferred to the public security organs, they shall be copied to the procuratorial organs at the same time.

(12) to improve the trial system and mechanism of securities cases. We should make full use of existing trial resources, strengthen the strength of financial trial work in the places where securities exchanges such as Beijing and Shenzhen are located, and explore the overall planning of the jurisdiction and trial of criminal, administrative and civil cases in the field of securities and futures. We will deepen the reform of the specialization of financial trials and strengthen the professional construction of financial trial teams. It shall be subject to the level jurisdiction of the cases of first instance of securities crimes handled by intermediate courts and procuratorates at the same level. We will increase the enforcement of administrative penalties and judicial decisions. Establish an expert consultation system and a special mechanism for professionals to serve as people's jurors.

(13) strengthen the construction of bases for handling cases and trials. The public security organs, procuratorial organs and judicial organs of some prefectures and cities such as securities trading places and futures exchanges shall set up securities crime handling and trial bases. We will strengthen the delivery of cases to the bases for handling securities crimes, and the corresponding procuratorates and courts shall be responsible for public prosecution and trial respectively, and shall have appropriate centralized jurisdiction over securities crimes in accordance with the law by means of jurisdiction over the place of the crime or designated jurisdiction.

(14) strengthen local territorial responsibility. Strengthen the exchange of information and law enforcement cooperation between the CSRC and local governments and relevant departments, study the establishment of an internal notification system for major illegal cases in the capital market, effectively prevent and restrict local protection and other obstacles and interference that may be encountered in handling cases, and promote efficient investigation and handling of cases. On the premise of insisting that financial management is mainly the responsibility of the central government, we should strengthen the responsibility of territorial risk disposal. Local governments should standardize all kinds of regional trading venues, crack down on all kinds of illegal securities and futures activities in accordance with the law, do a good job in preventing and dealing with financial risks in the region, and maintain social stability.

IV. Strengthening the punishment of major securities crimes and law enforcement in key areas

(15) strictly investigate and deal with major and important cases in accordance with the law. We will persist in classified supervision and accurate crackdown, and comprehensively improve the quality and efficiency of investigating and handling major cases of securities violations. In accordance with the law, major illegal cases such as fraudulent issuance, false statements, market manipulation, insider trading, trading using undisclosed information, and fabricating and disseminating false information should be investigated and dealt with as soon as possible. With regard to acts that seriously infringe upon the interests of listed companies, such as the occupation of funds and illegal guarantees, it is necessary to seriously investigate and recover compensation in accordance with the law and make rectification within a time limit. Increase the accountability of securities issuers' controlling shareholders, actual controllers, directors, supervisors, senior managers and other relevant responsible persons for securities violations. Strengthen the supervision of intermediary institutions, and if there are illegal acts of securities, the institutions and their employees shall be seriously investigated according to law, and illegal acts such as participating in and assisting in financial fraud shall be severely punished in accordance with the law. We will speed up the investigation, punishment and transfer of related cases. Probation shall be strictly controlled in accordance with the law.

(16) severely crack down on illegal securities activities in accordance with the law. Strengthen the coordination between market supervision, public security and other departments and the China Securities Regulatory Commission, improve the inter-departmental cooperation mechanism, resolutely ban illegal securities operating institutions, resolutely clean up illegal securities business, and resolutely crack down on illegal securities investment consulting and other activities. Strengthen the monitoring of off-site capital allocation and resolutely crack down on large-scale and systematic off-site capital allocation activities in accordance with the law. Strictly check the legality of the sources of funds for securities investment and strictly control the leverage ratio. Strengthen the connection between the administrative disposal of cases involving local trading venues and judicial work, and effectively guard against regional financial risks.

(17) to strengthen unified law enforcement in the bond market. We will strengthen unified law enforcement against all kinds of illegal acts in the bond market, focusing on cracking down on illegal acts such as fraudulent issuance of bonds, fraudulent disclosure of information, and lack of diligence and due diligence of intermediary agencies. We will constantly optimize the cooperation mechanism for the supervision of the bond market.

(18) to strengthen the legal liability for illegal acts of private placement. We will intensify the criminal crackdown on illegal fund-raising in the private equity field, misappropriation or misappropriation of fund property by private fund managers and their employees. We will speed up the formulation of interim regulations on the management of private investment funds, and implement differentiated supervision and industry self-discipline over venture capital enterprises and venture capital management enterprises.

V. further strengthen judicial cooperation in cross-border supervision and law enforcement

(19) strengthen cross-border regulatory cooperation. Improve data security, cross-border data flow, confidential information management and other relevant laws and regulations. We will step up efforts to revise the regulations on strengthening the confidentiality and archives management related to the overseas issuance of securities and listing, and consolidate the principal responsibility for information security of overseas listed companies. Strengthen the standardized management of cross-border information provision mechanisms and processes. Adhere to the principle of law and reciprocity, and further deepen cooperation in cross-border audit supervision. We will explore effective ways and means to strengthen cooperation in international securities law enforcement, actively participate in international financial governance, and promote the establishment of a law enforcement alliance to combat cross-border securities crimes.

(20) to strengthen the supervision of China-listed stocks. We will take practical measures to deal with the risks and emergencies of Chinese companies, and promote the construction of relevant regulatory systems. Amend the special provisions of the State Council on overseas share offering and listing of joint stock limited companies, clarify the responsibilities of domestic industry supervisors and regulatory departments, and strengthen the coordination of inter-departmental supervision.

(21) establish and improve the system of extraterritorial application of capital market laws. We will step up efforts to formulate judicial interpretations and supporting rules for the provisions of the extraterritorial application of the Securities Law, refine the specific conditions for the extraterritorial application of the law, and clarify law enforcement procedures, evidence effectiveness and other matters. We will strengthen foreign-related trials in the capital market and promote the mutual recognition and enforcement of judicial decisions in overseas countries, regions and China.

VI. Strive to improve the judicial ability and professional level of securities law enforcement

(22) strengthen the ability of securities law enforcement. We will strengthen securities law enforcement, optimize the establishment of securities inspection and law enforcement agencies, and promote and improve the securities law enforcement system and mechanism with Chinese characteristics that meet the needs of the development of the capital market. Give full play to the function of the party commitment system in securities and futures administrative law enforcement. We will improve the reward system for reporting illegal clues in securities, and strengthen the construction of a platform for accepting illegal clues.

(23) enrich the means of securities law enforcement. Effectively use big data, artificial intelligence, blockchain and other technologies to establish a monitoring and early warning system for the securities and futures market, build a new modern supervision and law enforcement model supported by science and technology, improve the efficiency of supervision and law enforcement, and strengthen the investigation and early warning of serious illegal hidden dangers, so as to achieve effective prevention, timely detection, and accurate attack.

(24) strict law enforcement and fair administration of justice. Firmly establish a sense of power and responsibility, evidence awareness, procedural awareness, and effectively enhance the professionalism, standardization, authority and credibility of law enforcement. We will strengthen unified law enforcement, formulate discretionary benchmarks for administrative penalties, and standardize law enforcement actions. We should give full play to the roles of reconsideration supervision, litigation supervision and procuratorial supervision, strengthen the standardization and supervision of regulatory and law enforcement agencies, resolutely correct irregularities in law enforcement and judicial work, and create a fair and just environment for the rule of law for the development of the capital market.

VII. strengthening the Construction of Credit system in Capital Market

(25) consolidate the institutional foundation of honesty and credit construction in the capital market. Add special provisions on the construction of good faith in the relevant laws and regulations, establish the responsibility system of the main body of the good faith record of the capital market, clarify the good faith conditions, obligations and responsibilities of the market participants, and carry out punishment and incentive for breach of faith in the capital market in accordance with the law.

(26) establish and improve the credit commitment system. Establish the credit commitment system of administrative license in the capital market, and clarify the scope of applicable subjects and licensing items. The credit commitments and their performance will be included in the credit records as an important basis for supervision after the event. For the party who seriously violates the promise, the relevant administrative license shall be revoked according to law.

(27) strengthen the honest supervision of the capital market. Establish and improve the national unified integrity files of the capital market, and comprehensively record the integrity information of the participants in the capital market. We will improve the mechanism of honest information sharing, and increase the intensity of information collection, inquiry and publicity. The relevant information will be incorporated into the national credit information sharing platform and the "Credit China" website to form a capital market integrity construction pattern of co-construction, co-governance and sharing.

VIII. Strengthening organizational security, supervision and accountability

(28) strengthen organizational leadership. All localities and departments should attach great importance to the judicial work of law enforcement in the capital market, earnestly unify their thinking and actions with the decision-making and deployment of the CPC Central Committee and the State Council, clarify the division of responsibilities, strengthen coordination of work, and implement their work responsibilities. to ensure that all tasks are implemented.

(29) strengthen the guidance of public opinion. We should do a good job in three-dimensional news and public opinion work to crack down on illegal securities activities, strengthen law enforcement publicity on key cases through various channels and platforms, give full play to the warning and educational role of investigating and handling typical cases, and send a clear signal of zero tolerance to the market. we will promote the formation of a good capital market ecology that advocates the law and keeps promises.

(30) strengthen supervision and accountability. We will continue to administer the party strictly in an all-round way and resolutely implement the requirements of deepening anti-corruption work in the financial sector. Law enforcement judicial organs and discipline inspection and supervision organs coordinate to promote risk management and anti-corruption work in the financial field, resolutely investigate and deal with various corruption problems behind financial risks, and at the same time pay attention to preventing capital market risks that may be caused by corruption cases. Priority should be given to the investigation and handling of cases that may affect the major reform process of the capital market, cases that may cause systemic risks, and cases of internal and external collusion between regulatory staff and market personnel. Strictly standardize the staff of securities regulatory institutions to serve in enterprises or other profit-making organizations directly related to their original business in accordance with the law. Those who do not strictly implement laws and regulations, fail to report clues, fail to put cases on file, fail to investigate and deal with them effectively, and affect the normal investigation and handling of cases, shall be seriously investigated for responsibility in accordance with the rules and regulations and in accordance with the law.