Zhang Xiaojun, spokesperson for the China Securities Regulatory Commission (CSRC), said yesterday that, in order to implement the CPC Central Committee and the State Council’s specific requirements on protecting the rights and interests of small and medium-sized investors and to further put into practice the regulatory philosophy centered on information disclosure, the CSRC has recently conducted a review of the main board. ( Includes the SME Board ) The content and format guidelines for annual report disclosures by companies listed on the ChiNext Board have been merged and revised.

Zhang Xiaojun stated that this revision addresses the key issues identified in practice by emphasizing the usefulness of decision-making, streamlining procedures, simplifying complexity, and making information easier to access and use. It fully meets investors’ information needs, establishes a tiered information disclosure system under a unified framework, seamlessly integrates initial public offering (IPO) disclosures with ongoing disclosure requirements, takes into account the reasonable information supply demands of listed companies, and strikes a balance between fairness and efficiency through market-oriented approaches.

First, establish a concept oriented toward investor needs. Highlight key content and ensure information is effectively conveyed. “ Useful ” All information that is material to investors’ decision-making should be placed prominently, highlighted in terms of content, and clearly structured in terms of hierarchy. As for redundant information that investors are not interested in or that has already been disclosed in previous years, we should add indexes, significantly simplify it, or remove it altogether. We encourage the use of plain and straightforward language to ensure that information is easily understood. “ Easy to understand ” Encourage clear, easy-to-understand, and straightforward language; avoid overly complex, specialized, and unnecessary data; and minimize redundant information.

Second, we will establish a tiered and unified framework for information disclosure. We will organically integrate the existing annual report guidelines for the Main Board and the ChiNext Board to form a unified set of annual report guidelines. We will also set forth tiered requirements for information disclosure and risk disclosure: In terms of disclosure levels, we will divide them into three tiers—namely, the statutory minimum requirements for information disclosure, “ Non-disclosure is explanation. ” The exemption disclosure regulations encourage companies to voluntarily and proactively disclose information. In terms of risk disclosures, a distinction is made between material risks and other risks; for material risks, prominent and key warnings must be included in the main section of the annual report. Regarding the order of disclosures, the existing framework is consolidated, with some chapters merged or newly added, and revised based on their relevance to investors’ decision-making. A special disclosure mechanism for delisted companies has been introduced, adding requirements for voluntary delisting, mandatory delisting due to serious violations of law, restrictions on share reductions by relevant entities within the company, and disclosures during the delisting reorganization period. These requirements are reflected separately—in the body of the annual report, the summary of the annual report, and the special disclosure report on delisting—according to the principle of materiality.

Third, we must take into account the practical factors of balancing the cost of corporate information disclosure with the protection of trade secrets. Considering that excessive information disclosure could lead to the leakage of a company’s trade secrets, thereby harming both the company’s commercial interests and the interests of investors, we introduce... “ Non-disclosure is explanation. ” The commercial secrecy exemption disclosure regulation protects companies’ trade secrets while enhancing the flexibility and inclusiveness of information disclosure.

In addition, Zhang Xiaojun stated that the CSRC will promote random inspections in the field of securities and futures regulation.

It is understood that, in accordance with relevant laws, regulations, and rules, as well as the CSRC’s supervisory and inspection responsibilities, the items included on the CSRC’s list of randomly selected inspection items total: 17 Item: The random inspection work plan clearly specifies the name of the inspection items, the legal basis for the inspection, the inspecting entity, the inspection content, the inspection method, the inspection sampling rate, and the inspection frequency.

Zhang Xiaojun stated that the CSRC will establish a database of inspection targets and a database of law enforcement inspectors based on the list of randomly selected inspection items, and will implement a system for randomly selecting inspection targets and randomly assigning law enforcement inspectors. “ Double Random ” Random inspection mechanism: The CSRC conducts on-site inspections. Except in cases where there is preliminary evidence or leads indicating obvious suspected violations—cases that are legally initiated for investigation—or when special inspections are scheduled based on identified issues and risks, all other inspections must be conducted by randomly selecting inspection targets from a designated pool of potential subjects through methods such as lottery or random selection by computer, and by randomly assigning enforcement inspectors from a designated pool of enforcement personnel.

Zhang Xiaojun stated that the CSRC’s random spot-check program will... 2016 The comprehensive inspection will be carried out annually, and the results of random checks will be promptly made public to accept social oversight. The CSRC will strictly punish any illegal or non-compliant behaviors identified during these random checks in accordance with laws and regulations. (Reported by Zeng Fubin, Securities Times)